Close Menu
ADVERTISE

Solana Network and DeFi Activity suggest SOL Price Rally will Continue

Altcoins By
Can The Coin Reach $0.0001 Soon?
Can The Coin Reach $0.0001 Soon?

The key takeaways

  • Solana’s TVL of $10.9 billion surpassed Ethereum layer-2.

  • Solana’s fee revenues for the 30 days (43,4 million dollars) increased by 109% over the month before.

  • SOL’s funding rate of 8% shows healthy demand from bulls.

Solana native token SOLSOLBetween May 6 and 10,, a surge of 24.8% was recorded following the rally in altcoin markets after Bitcoin surpassed $100,000. SOL’s price has been struggling since then to remain above $180. But data on the blockchain and derivatives still indicate further gains.

SOL/USD vs. altcoin markets. TradingView/Cointelegraph

Solana Network ranks second in on-chain metrics, including total value locked.

Source: DefiLlama. Source: DefiLlama

Solana’s $10.9 Billion total value lock (TVL) exceeds Ethereum layer-2 ecosystemBase, Arbitrum and Avalanche are included in this group. Solana is outperforming BNB Chain which seamlessly integrates with Binance and Trust Wallet. Raydium DEX is up 78% and Jito, up 80%. liquid staking Marinade has gained 56%, while solution is up by 41%.

SOL demand is boosted by rising fees

Decentralized finance is not a guarantee of demand for the native coin, as some networks offer extremely low transaction fees. According to DefiLlama’s data, Ethereum only generated $24.9m in base-layer fees during a recent 30 day period. Tron generated $51.9m and Solana $43.3m.

Solana network DApps revenue (left) vs. chain fees (right). Source: DefiLlama

Solana DApps revenue and chain fee have consistently grown over the last four weeks. This is a positive development for SOL as the figures have reached their highest level in 3 months. This dynamic is also supportive of price increases, as 65% SOL supplies are staked.

Related: Solana co-founder proposes meta chain to fix blockchain fragmentation

Leverage demand can be used to gauge whether or not traders have become more confident about SOL’s future price prospects. A positive funding means long-term positions (buyers), are being paid to maintain their trades.

SOL perpetual Futures Annualized Funding Rate Source: Laevitas.ch

The SOL futures are currently available. funding rate It is currently at 8% which, based on cost of capital, falls into the neutral range between 5% and 10%. SOL’s current price is 40% lower than its high from January 19, when it was $295. There are few reasons to expect SOL to reach $200 soon. SOL may be able to reach $200 very soon, if the Solana Network is active.

It is unclear what catalyst could drive SOL’s price up, but possible factors include approval by a spot Solana exchange-traded fund (ETF), as well Solana’s possible inclusion in an state-level digital assets strategic reserve. Some analysts also believe that the traditional tokenization of assets on Solana could bring SOL even more value.

The article does not provide legal advice or investment recommendations and it is intended for informational purposes only. This article is solely for informational purposes. It does not represent or reflect Cointelegraph’s views.