Solana is once again the talk of crypto, and native coin SOL is taking advantage of the spotlight. The price of SOL is up more than 9% today, hitting a 24-hour high of $44.41.
Over the past 30 days, it has exploded in value by more than 88%, according to CoinGecko—making it the biggest gainer of all major cryptocurrencies.
And despite his ties to the failed FTX crypto exchange and its convicted founder Sam Bankman-Fried, Solana's recent rise should not come as a shock, experts say.
Widely considered a competitor to Ethereum, Solana aims to be the go-to network for on-chain applications and experiences. Proponents of Ethereum argue that the leading smart contract network offers more stability and security, but Solana is actually cheaper and faster for those who want to build or use credit protocols, games, and other applications that use blockchain technology.
Solana gas charges now stand at $0.000522; It costs $6.58 on average to do a transaction on Ethereum.
Because of this, Solana has attracted the attention of Visa, Shopify, and developers who want to build on the network.
“Solana takes a streamlined approach with a focus on high base layer flow, simplifying the developer experience,” said Akash Mahendra, portfolio manager at Yield Apps. DecryptShowing how much data can be processed with blockchain.
Major partnerships and institutional interest are helping to drive up SOL's value, Mahendra added.
It wasn't long ago that Solana got a bad rep. FTX, once one of the biggest and most popular brands in the crypto space, is heavily invested in Solana.
Former FTX boss and co-founder Sam Bankman-Fried was a prominent supporter of Solana, and the company invested in several Solana-related projects. FTX opened a marketplace for Solana NFTs, and co-created Cerum, which was once considered the foundation of Solana's Defy space. In the year At its peak in 2021, Solana will command a $78 billion market cap and boast a $10 billion DeFi ecosystem.
FTX then went into a highly publicized bankruptcy with more than $1 billion in SOL. As a result, the cryptocurrency crashed.
But the big players still see real value in the project.
In August, the Solana Payments protocol was integrated with e-commerce platform Shopify, allowing merchants to accept the blockchain-stable coin USDC. This partnership is focused on Shopify's influential 10% share in the US online retail sector, which translates to an estimated $444 billion in global transactions,” said Mahendra.
Then, payments giant Visa announced in September that it had chosen Solana's blockchain for its stablecoin ambitions. This, according to Austin Federa, chief strategy officer of the Solana Foundation, “confirms the importance of the network's unmatched speed and expansion.
These two moves were seen as bullish by investors who were pouring new cash into the project. And things really picked up in the last month.
said Patrick Felder, founder and CIO at Prismatic Capital. Decrypt This is because when Bitcoin and the broader crypto market began to converge, SOL was the most traded asset in the space. News FTX's new management may sell a large amount of SOL.
But this, according to Felder, has led to FUD (Fear, Uncertainty and Doubt) and “a massive short squeeze”. In the business world, a short squeeze is when the price of an asset rises unexpectedly due to the exit of short sellers (those who are betting on the asset).
This happened at SOL, according to Felder, where many bet on the Sam Bankman-Fried FTX trial hurting the asset value.
The Solana community's annual conference, Breakpoint, was held in late October and led to a large rally, Felder added.
What is surprising is the value of SOL at Breakpoint last year. He had fallen. By 60% in the week after the FTX crash. Spirits were low. But now the coin has made a spectacular comeback.
As always the question remains?
Edited by Ryan Ozawa.
