Crypto markets love simple narratives. Capital flows into whatever chain looks fastest, whatever ecosystem feels hottest, whatever ticker is moving. But every few years, someone steps back and points out that the real rotation is happening somewhere else entirely.

That’s what ElonTrades did in a recent post on X.

ElonTrades, known for calling Solana early when it traded below $1, shared a new thesis that challenges one of the biggest assumptions in the space: that institutional capital will eventually settle on the major public blockchains.

His view is blunt. The next rotation may not be Ethereum versus Solana. It may be public chains versus private infrastructure.

ElonTrades reminded followers that his original Solana thesis back in 2020 was straightforward: Ethereum would not scale fast enough, and users would migrate toward chains built for speed and smooth execution.

That played out. Solana grew into one of the most active retail ecosystems in crypto, driven by low fees, fast transactions, and an integrated user experience that many traders prefer over fragmented Layer 2 setups.

But his 2026 view is very different.

One of the sharpest parts of the thread was his critique of Ethereum’s Layer 2 landscape.

ElonTrades argued that L2s solved one problem but created several others:

Instead of one unified network, users now face a maze of rollups, bridges, wrapped assets, and shifting liquidity pools. For retail, that often pushes activity toward chains that feel simpler and more seamless.

I Called Solana Below $1. Here’s Where I Think Capital Flows Next

Today I still think L2s are a band-aid that created more problems than they solved — liquidity fragmentation, bridging risk and UX complexity that pushes users toward integrated chains like Solana.

But… pic.twitter.com/uxcnN1VB3d

In his words, integrated chains like Solana benefit from that reality.

Here’s where his thesis becomes more controversial.

ElonTrades does not believe institutions are picking Solana as the endgame. In fact, he thinks they are not choosing any public chain at all.

His argument is that traditional finance has looked at the full landscape (Ethereum, L2s, Solana) and decided none of it meets core institutional requirements:

Instead of adapting to public crypto infrastructure, institutions are building parallel systems from scratch.

Read also: XRP Is Bleeding Fast, Could Get Ugly If Price Crosses This Line

ElonTrades pointed directly to the Canton Network as the clearest example of this shift.

Canton is designed for financial institutions that want blockchain-style settlement and tokenization, but within a framework that allows privacy and permissioned access.

The implication is simple: the largest pools of capital may not flow into Ethereum or Solana at all. They may flow into purpose-built private rails that never touch retail ecosystems.

That would represent a major structural change in how people think about adoption.

His most striking conclusion is that Layer 2s end up stuck in the middle.

Too fragmented for retail users who want simplicity.
Too open and permissionless for institutions that need compliance.

If that plays out, the crypto landscape could split into two worlds:

Public L2s would struggle to dominate either lane. ElonTrades is talking about infrastructure gravity.

Retail flows chase usability and liquidity.
Institutional flows chase regulation, privacy, and control.

If institutions truly build their own rails, the biggest winners in crypto may not be the chains people expect. The next rotation would not be “ETH to SOL.” It would be “public to private.”

Read also: Bitcoin (BTC) Is Still Going Down, and the Real Panic Hasn’t Even Started Yet

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The post Analyst Who Called Solana at $1 Predicts the Next Capital Rotation Will Shock Crypto appeared first on CaptainAltcoin.

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