Solana saw a significant increase of about 20% during the last few days of September and the first week of October. This sudden price increase has piqued the interest of investors and enthusiasts alike, sparking discussions about its underlying causes.
A prominent question on people’s minds is whether this revival will continue The value of SOL is directly correlated with Bitcoin’s performance over the same period or if there are several factors driving SOL’s price increase independent of Bitcoin’s movements.
Before this raise, SOL was struggling as a US court allowed the $1.3 billion sale of SOL from the bankrupt exchange FTX. So, there is curiosity as to whether the recent SOL price increase is related to Bitcoin or if there are other factors behind it.
Solana: challenges and market appeal
The Solana (SOL) blockchain network has seen recent problems, but it has received significant attention and demand in the market. Despite the lackluster price performance of its native token, the proof-of-stake (PoS) network has used the bear market to improve its technological capabilities and forge key alliances with prominent entities in the traditional banking space.
Source: Coingecko
The bankruptcy court has implemented mechanisms to mitigate the potential negative impact of the liquidation of FTX assets on the cryptocurrency market. These measures include mandating the sale of assets through a financial advisor in weekly installments, subject to pre-determined regulations.
At the time of writing, SOL was trading at $23.43, up a measly 0.3% in the last 24 hours, but gaining rallied 18% in the past seven days, according to data from crypto market tracker Coingecko.
SOL liquidity increases due to network stability
Nansen, an on-chain analytics company, recently published a report on Solana, highlighting its key strengths and capabilities. Solana is known for its cost-efficiency and fast transactions, earning it the nickname ‘The Ethereum Killer’. It boasts a transaction processing speed of over 3,000 transactions per second, which is almost 30 times faster than Ethereum.
The chain’s liquidity improved as a result of the dramatic increase in network stability. At the time of writing, the TVL in SOL terms was $27.12 million, more than double what it was at the beginning of the year.
SOL market cap currently at $9.7 billion. Chart: TradingView.com
Solana’s rise, powered by DApps and NFTs, is targeting the 5th largest crypto spot
SOL’s rise was further amplified by the expansion of decentralized applications (DApps) adoption and the increase in non-fungible token (NFT) volumes on the Solana blockchain.
SOL’s current price is now making attempts to reach a support level of $23, aiming to solidify its position as the fifth largest cryptocurrency (excluding stablecoins) in terms of market capitalization.
In the recent era 512, there were 19.637 million SOL unstaked, with a net unstake of 16.516 million SOL (approximately $372 million). Most belonged to a16z and the previous Alameda (now or ftx estate).
a16z: BZpEFk…oPPBm7 unslotted 5.006 million SOL, a16z-2: GCmFQL…ozXMwY unslotted 2.033…
— Wu Blockchain (@WuBlockchain) October 6, 2023
Meanwhile, recent updates for Solana compass have revealed details about recent activities on the Solana network, especially during the 512 era.
The website that tracks SOL staking activity suggests that there were approximately 19.637 million SOL coins unstaked during this period.
(The content of this site should not be construed as investment advice. Investing involves risks. When you invest, your capital is subject to risk).
Featured image from iStock
