This episode reveals how institutional products like DATs and ETFs are poised to be Solana's next major catalyst, forcing the network to sharpen its narrative beyond memecoins to capture real-world economic activity.
Introduction to Framework Ventures and Solana Focus
- Framework's Thesis: The firm targets seed and Series A stages, seeking founders who leverage on-chain capital for new markets.
- Brandon's Background: With a background in engineering and product, Brandon brings a technical and full-stack investment approach to the team.
Solana's Venture Landscape and Narrative Doldrums
- Current Market Sentiment: Despite strong price performance for major assets, Brandon senses a "muddied, if not skewing bearish" sentiment in his conversations, creating a disconnect between market reality and perception.
- The Narrative Gap: Jack Kuban notes a "vibe change" around Solana, with some perceiving it as less hyped than a year ago. Brandon agrees, pointing to a "dearth of narrative" that leaves the ecosystem in a temporary lull.
The Twin Catalysts: DATs and ETFs
- Brandon identifies DATs (Digital Asset Trusts)—investment vehicles that hold digital assets—and ETFs as Solana's most significant upcoming catalysts. He draws a direct parallel to Ethereum, where approximately $45 billion in combined DAT and ETF inflows generated an estimated $300 billion in new market value.
- Back-of-the-Napkin Math: With Solana DATs having raised around $2.5 billion and ETFs yet to launch, Brandon projects a potential $100 billion in market cap creation if Solana follows a similar value creation multiple as Ethereum.
- Macro Tailwinds: He suggests a potential FOMC rate cut around September could provide a risk-on environment, aligning perfectly with the timeline for these product launches. Brandon notes, "I think folks are going to be surprised at the velocity."
- Strategic Implication: Investors should closely monitor capital inflows into Solana DATs and ETFs as a primary indicator of institutional demand and a potential trigger for significant price appreciation.
The LST Debate: A Bet on On-Chain Activity
- MEV (Maximal Extractable Value): This refers to the profit validators can capture by reordering or inserting transactions in a block. Jito's protocol is designed to capture and redistribute this value to stakers.
- Brandon's Thesis: He posits that creating a proprietary LST to capture staking emissions is short-sighted. Instead, using JitoSOL aligns a fund with long-term, organic on-chain activity, including transaction fees and MEV, which will outlast inflationary rewards.
- Quote: "Anyone who isn't leveraging JitoSOL is synthetically short on-chain activity on Solana."
- Actionable Insight: Researchers should analyze the yield composition of various LSTs. A reliance on inflationary emissions presents a different risk profile compared to yields derived from organic network activity like fees and MEV.
Winning the Narrative War: On-Chain Metrics vs. Storytelling
- Solana's Counter-Narrative: Brandon suggests Solana should focus on metrics related to user growth, attention, and transaction volume, positioning itself as the "volume game" in contrast to Ethereum's "AUM and liquidity game."
- The Consumer Angle: While memecoins are often dismissed, Brandon views them as an "early harbinger" of user interaction and sticky network effects. The key is to translate this initial engagement into more sophisticated financial applications.
- Strategic Focus: Solana's path forward lies in extending its DeFi primitives into consumer-facing financial services, particularly in areas like payments, DePIN, and AI, where its low-cost, high-throughput architecture provides a distinct advantage.
DeFi's Second Act: The Stablecoin Revolution
- Stablecoins as a Financing Tool: With over $270 billion in liquidity seeking yield, stablecoins can underwrite economic activity that legacy banks, focused on large-scale clients, often ignore.
- The Business Model Shift: Stablecoins collapse legacy banking software and financing models into a single, efficient layer, enabling new businesses to acquire global customers from day one.
- Actionable Insight: Investors should look for companies using on-chain stablecoin infrastructure to solve real-world problems in fintech, B2B payments, and cross-border commerce, as this represents a massive, underappreciated growth vector.
Solana's Path to Improvement: Perception is Reality
- Winning Top-of-Funnel: The primary goal is to ensure that when founders consider building new applications, Solana is a top contender. This requires a concerted effort in storytelling and narrative-building.
- The Role of Leadership: The discussion touches on Solana Foundation President Lily Liu's recent CNBC appearance, where she framed Solana's total addressable market as "internet capital markets." This is seen as a crucial step in establishing a clear, institutional-friendly narrative.
- Strategic Implication: The success of Solana's ecosystem will increasingly depend on its ability to market its value proposition effectively to both institutional capital and the next wave of builders.
Conclusion
This discussion highlights that Solana's future growth depends on successfully launching institutional products like DATs and ETFs while simultaneously winning the crucial narrative battle for founder mindshare. For investors and researchers, the key is to track both the flow of institutional capital and the emergence of new, user-centric applications that leverage Solana's unique architectural strengths.
