Solana is emerging as a settlement platform for Visa and JPMorgan, but one indicator continues to concern insiders.

Wyoming introduced a state-sponsored stablecoin on Solana, and Morgan Stanley submitted an application for a Solana trust product this week. Last month, Visa broadened USDC settlement to operate on Solana infrastructure, and JPMorgan tokenized commercial paper utilizing Solana as part of the settlement framework.

These are not mere speculations or future promises. They occurred within a span of 60 days, compelling a more straightforward question than the previous binary: institutions are no longer questioning whether to engage with Solana, but rather how much exposure they should have and on which layer.

The assertion that “institutions won’t adopt Solana” lasted as long as it did because it mixed two distinct bets: gaining SOL exposure through vehicles like ETFs, and utilizing Solana as a foundation for settlement, stablecoin distribution, or tokenized assets.

The first pertains to risk tolerance and regulatory clarity. The latter concerns operational necessities such as speed, cost, uptime, and compliance surfaces.

What shifted in 2025 was that both paths started yielding measurable results concurrently, making it increasingly difficult to defend the blanket rejection without disregarding the facts.

Wyoming’s credibility initiative

On January 7, the Wyoming Stable Token Commission unveiled the Frontier Stable Token, a state-issued digital dollar backed by reserves managed by Franklin Templeton.

The token was launched with distribution via Kraken on Solana and through Rain on Avalanche.

Wyoming is not a DeFi protocol or a speculative project, but rather a US state with regulatory responsibilities and fiduciary duties. Moreover, Franklin Templeton is a $1.6 trillion asset management firm.

This combination creates a compliance framework around Solana that institutions can reference when justifying integration. If a state government trusts the infrastructure enough to distribute a reserve-backed token, the argument that “Solana is too risky for legitimate finance” significantly weakens.

Six institutional Solana advancements took place within 60 days, including Wyoming’s state stablecoin launch, Morgan Stanley’s ETP filing, and Visa’s expansion of settlement capabilities.

Morgan Stanley submitted initial registration statements for exchange-traded products tracking both Bitcoin and Solana on January 6.

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The filings categorize them as trusts, which are spot-style wrappers providing investors with regulated exposure without necessitating direct custody or blockchain interaction.

What is significant is that a Wall Street entity managing $1.5 trillion in client assets is developing distribution for Solana alongside Bitcoin, considering both credible enough to warrant the compliance burden and reputational risk associated with a public filing.

This follows the SEC’s approval of standardized listing criteria for commodity-based crypto ETPs, which diminishes the need for individual exchange approvals.

This procedural change reduces the barrier to launching new products, which is why institutional observers anticipate a surge of altcoin ETPs in 2026.

JPMorgan projected that altcoin ETFs could attract approximately $14 billion within their initial six months, with around $6 billion flowing into Solana-targeted products.

These are projections, not certainties, but they illustrate institutional positioning: firms are envisioning Solana as a significant component of crypto allocations, not merely as a niche retail investment.

Settlement infrastructure is more critical than price exposure

The more enduring institutional narrative does not revolve around SOL price or ETF inflows, but rather about Solana being utilized as settlement infrastructure for tokenized dollars and cash-like instruments.

Visa announced in December that it is broadening stablecoin settlement with USDC on Solana and extending that capability to US-based institutions.

The company reported around $3.5 billion in annualized stablecoin settlement volume across its network, and Solana’s efficiency and cost structure make it ideally suited for high-frequency, low-value payment transactions that traditional systems struggle to manage effectively.

JPMorgan’s initiative goes further. In December, JPMorgan issued JPM Coin-denominated commercial paper on a public blockchain, utilizing Solana for tokenization, along with R3’s Corda for permissioned settlement.

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This is short-term debt issued by a systemically important bank, tokenized and settled on Solana’s infrastructure.

The fact that JPMorgan is experimenting with Solana for collateral and settlement processes indicates that the bank considers the chain operationally viable for institutional finance, even if only as one element in a multi-chain architecture.

Solana’s stablecoin ecosystem supports this narrative. Data from DefiLlama reveals that the chain holds nearly $15 billion in stablecoins, with USDC representing approximately 67% of that total, as of January 7.

Solana’s stablecoin supply surged from $5 billion in early 2025 to around $15 billion by January 2026, nearly tripling within the year.

Daily on-chain activity records around 2.37 million active addresses, 67.34 million transactions, and $6.97 billion in DEX volume over the past 24 hours.

Tokenized real-world assets on Solana amount to approximately $871.4 million in distributed asset value, accounting for roughly 4.5% of the RWA market, a share that grew 10.5% over the past 30 days.

Tackling the centralization critique

The most persistent institutional concern regarding Solana has been the risk of centralization: client monoculture, stake concentration, validator economics, and infrastructure requirements that favor well-capitalized operators.

The introduction of Firedancer, a second validator client developed by Jump Crypto, directly addresses the client monoculture issue. Firedancer went live on the Solana mainnet on December 12, enabling validators to select between two clients rather than depending solely on the Solana Labs implementation.

This mitigates the risk that a single bug or exploit could disrupt the entire network, which was the tail risk that kept some institutions at bay.

However, Firedancer does not resolve all concerns regarding centralization. Stake distribution continues to be concentrated among a limited number of validators, and delegation inertia often leads to stake being directed towards the largest, most prominent operators.

Solana’s own network health reporting indicates approximately 1,295 validators and a Nakamoto coefficient around 20 as of an April 2025 snapshot, better than many proof-of-stake chains, yet still far from the decentralization profile of Bitcoin or Ethereum.

Institutions will assess this as governance and operational risk: who can influence upgrades, how quickly critical patches are deployed, and whether validator economics remain sustainable under pressure.

The institutional evaluation is not “is Solana decentralized enough,” but rather “is the risk contained and manageable.” Client diversity diminishes systemic risk, while validator count and geographical distribution lessen single-point-of-failure concerns.

Operational guidelines for managing outages and monitoring tools for assessing network health simplify integration into compliance frameworks.

Centralization review

Centralization critique (the claim)	What it means in practice	Reality check (what’s true / what’s improved)	Remaining risk (what still matters)	How institutions price it (what it affects)
“Solana is centralized because it’s basically one client.”	If most validators operate on the same codebase, a single bug can turn into a network-wide issue.	The client-monoculture critique has weakened as Solana progresses toward multi-client validation (with Firedancer as the “second client” milestone). This reduces the risk of a single-software failure.	Client diversity only provides benefits if adoption is significant (share of stake/validators actually using each client), and if incident response isn’t still coordinated through a narrow set of actors.	Operational risk & outage risk → integration approval, settlement limits, business continuity mandates.
“Stake is concentrated, so decentralization is cosmetic.”	A limited set of entities can dominate consensus influence through delegated stake.	High validator counts don’t automatically translate to low concentration; critics are correct that delegation inertia frequently channels stake to large, visible operators.	Concentration can persist even as the network expands; if large operators or custodians dominate delegation, “decentralization optics” remain fragile.	Governance risk premium → higher internal haircuts, smaller initial caps, stricter counterparties.
“Validator requirements favor whales; it’s not accessible.”	If hardware, bandwidth, and operational costs are high, fewer independent validators can compete.	Performance-oriented design does elevate operating costs compared to some chains; institutions accept that tradeoff if it enhances speed and predictable execution.	If economics compress (fees drop, rewards diminish), weaker validators may exit → concentration increases.	Sustainability risk → vendor due diligence, long-term support concerns, “is this a durable rail?” inquiries.
“It’s centralized because it runs on a few cloud providers / regions.”	Hosting concentration creates correlated failures and censorship/regulatory choke points.	Even with numerous validators, correlated infrastructure can still be a hidden single point of failure. The critique often pertains to where validators operate, not just how many exist.	Geographic/provider clustering can spike during stress events; regulatory pressures can have an outsized impact if key operators are located in a limited set of jurisdictions.	Censorship & continuity risk → jurisdictional controls, disaster recovery posture, vendor concentration limits.
“A small group can push upgrades quickly; that’s centralized governance.”	Rapid upgrades can imply social centralization (coordination dominated by a narrow set of teams/operators).	Fast iteration can be advantageous for institutions if it is predictable, transparent, and well-governed (change management).	If upgrades appear opaque or rushed, it can be interpreted as governance centralization—especially following incidents.	Change-management risk → slower rollouts, maintenance windows, strict versioning policies.
“RPCs/infrastructure are centralized, so institutions still rely on a few gatekeepers.”	Even if validators are dispersed, most users connect through a handful of RPC providers, creating choke points.	This represents a genuine centralization layer for many applications—often more critical than validator count for user access and reliability.	If a few RPCs throttle, fail, or limit access, the chain’s perceived reliability suffers irrespective of consensus decentralization.	Reliability & vendor risk → multi-RPC requirements, SLAs, failover architecture, higher integration costs.
“MEV / priority fees centralize power in sophisticated actors.”	Ordering advantages accrue to those with superior infrastructure, routing, and relationships—raising fairness and market integrity concerns.	High-throughput chains can still concentrate “execution advantage” even if consensus is distributed.	If MEV becomes excessively extractive or opaque, it undermines institutional comfort (best execution, market integrity).	Market structure risk → compliance review, execution policies, venue selection, surveillance requirements.
“Centralization risk is why ‘serious finance’ won’t settle here.”	Institutions won’t engage with rails they cannot explain to regulators/auditors.	The existence of regulated wrappers and credible settlement experiments suggests that the absolute claim no longer holds; institutions can operate with bounded risk.	“Engagement” ≠ “full reliance.” Many institutions will maintain Solana as one component in a multi-rail architecture until risks are demonstrably managed over time.	Adoption curve → initial pilots, capped volumes, gradual expansion tied to KPIs and incident-free periods.

Three scenarios for the coming year

The most straightforward approach to evaluate whether institutions are genuinely embracing Solana is to monitor three measurable outcomes over the next year.

The first is the “wrapper wave,” assessed by whether Morgan Stanley’s filings and the SEC’s streamlined listing criteria result in a quicker pace of Solana ETP launches and whether those products gather significant assets under management.

The base scenario is that Solana wrappers accumulate low single-digit billions in AUM if distribution is widespread and liquidity remains robust. The optimistic scenario aligns with JPMorgan’s projections for Solana-focused products, which are around the $6 billion mark.

However, the downside risk is that approvals occur, but demand is weak, leading to flows concentrating in Bitcoin and Ethereum instead.

The second is the “rails first” scenario, observable in whether Visa’s expansion of settlement and other banks’ or fintechs’ pilots opt for Solana for stablecoin and tokenized cash processes.

The indicator here is Solana’s stablecoin market cap and the caliber of issuers and holders. If new regulated issuers debut on Solana and if stablecoin growth reflects institutional usage rather than DeFi speculation, the rails thesis gains strength.

The regulatory landscape is also evolving in Solana’s favor. The GENIUS Act, which seeks to establish a federal stablecoin framework, is being regarded by institutional analysts as a potential catalyst for on-chain money adoption.

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The third is a backlash or re-risking scenario triggered by a significant incident, such as a network halt, an exploit, or a governance optics spike that causes institutional pilots to pause.

The telltale sign would be stablecoin issuers decreasing their exposure, wrappers underperforming, and a return to the narrative that “Solana is too risky.”

Solana ETP assets under management could vary from under $1 billion in a bear case to $6 billion in a bullish case over the next year.

What to monitor as proof of concept

The discussion will be settled through data, not assertions.

Solana’s stablecoin market cap and issuer composition, settlement credibility indicators from Visa and other payment entities, RWA distributed asset value on Solana, ETP pipeline density, client diversity adoption beyond Firedancer’s initial launch, and liquidity depth across DEX and CEX platforms are all measurable over the next six to twelve months.

If these metrics improve and if no major operational failures occur, the thesis that “institutions won’t engage with Solana” becomes untenable.

What is already evident is that the question has shifted from legitimacy to scale. Institutions are engaging with Solana through wrappers, through settlement experiments, and through stablecoin distribution.

The remaining uncertainty is not whether they will interact with it, but how much significance they will place on it and under what circumstances.

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