Morgan Stanley’s Solana ETF sparks SOL vs. ETH debate – What’s going on?

2026 has kicked off with altcoins finally getting their momentum.

The Altcoin Season Index has jumped to the level that acted as resistance in mid-November. However, with some alts up 20%+ versus Bitcoin [BTC], it’s clear that these moves are driven by market flows, not just BTC’s rally.

In essence, most altcoins are carving their own path. In this context, Morgan Stanley’s Solana [SOL] news couldn’t have come at a better time, giving extra fuel to capital flows into SOL as it hangs around a key ceiling.

Source: TradingView (SOL/USDT)

For context, Solana has kicked off the New Year with solid momentum. 

According to the latest filing, Morgan Stanley, one of the world’s largest banks with $6.4 trillion in assets under management (AUM), has filed an S-1 registration for the “Morgan Stanley Solana ETF Trust” with the SEC.

At a macro level, this move narrows the gap between TradFi and DeFi.

On a micro level, however, analysts noted Morgan Stanley’s lack of interest in an Ethereum [ETH] ETF, raising a key question: Is this move setting the stage for what’s next between the two leading L1s as 2026 progresses?

Solana vs. Ethereum: Competing for Wall Street attention

Altcoin divergence this early in 2026 doesn’t look random.

ETF flows make that pretty clear. On the 6th of January, Bitcoin (BTC) ETFs saw about $240 million in net outflows, while Ethereum and Solana ETFs printed inflows of $115 million and $9.2 million, respectively.

At first glance, capital clearly favors Ethereum. However, this is where Morgan Stanley’s SEC filing starts to matter. On the DeFi side, Solana’s TVL is up roughly 9% this week, compared to about 6% for Ethereum.

Source: TradingView (SOL/ETH)

Put simply, Solana’s on-chain performance is looking stronger.

The result? Technically, the SOL/ETH ratio is up 3%, bouncing off the same floor that triggered a 28% rally back in 2024. With institutional support for SOL growing, a repeat of that move doesn’t seem too far-fetched.

What’s more, even after the SOL/ETH ratio fell 27% in 2025, Morgan Stanley’s continued focus on Solana further reinforces its on-chain strength, with early signs clearly pointing to a growing edge over ETH.

Final Thoughts

• Solana’s on-chain performance is strengthening, with TVL up 9% this week and the SOL/ETH ratio bouncing off key support.
• Morgan Stanley’s Solana ETF filing highlights growing institutional interest, reinforcing SOL’s growing edge over Ethereum.