Solana is at a year-to-date high after July’s 27% gain and SOL price ‘double down’.
Solana's SOL (SOL) coin price is set to close in on a 30% monthly return in July and looks poised to test its yearly high around $210 in the next few weeks.
While much of the community attributes SOL's success to Solana's memecoin euphoria, the network's strong liquid staking ecosystem is emerging as a strong onchain narrative. Let's see how this current trend is developing on the Solana network.
Solana DeFi is leading Liquid Tokens.
Cointelegraph recently highlighted how Solana's total value locked (TVL) jumped 10%, reaching $5.42 billion. As a result, transaction volume increased and onchain activity increased.
Jito and Marinade were the main protocols on Solana, recording 40% and 30% TVL increases in the last month.
Liquid compression is a process that combines the positive aspects of storage and liquid. Holders deposit their tokens into a smart contract or staking pool and receive a token representing their stake in SOL.
This token is referred to as a Liquid Staking Token (LST) and can be used to access products on other protocols or in decentralized financial applications. For Jito and Marinade, these tokens are JitoSOL and mSOL, respectively.
Data from Dune Analysis shows that the total amount of SOL placed in liquid stock derivatives will more than double by 2024. Staked LSTs rose from 163,827 to 807,712, a 393% increase between June 1 and July 26.
Data analytics platform Token Terminal also saw Solana's daily and weekly active users increase by 21% and 59%, respectively. Adding active users is a simultaneous addition to TVL for Gito and Marinade as described above. So, it can be assumed that memecoins are not the only sector bringing users to the Solana network.
Will SOL hit a new annual high this week?
SOL's price action shows high momentum, and the community expects the price to test the annual high at $210. At the time of publication, SOL had breached a bullish double-bottom pattern, above current resistance at $202.
Upside resistance is very weak, and a retest of the annual high is very likely. However, Solana is currently seeing a correction below $190.
If Solana continues to follow a bearish trend, a quick test target remains in the $200-$210 range. Conversely, if it loses the immediate support zone at $180, the altcoin may retest the previous swing low at $165.
Meanwhile, options trader Wyck leans bullish, stating that SOL/USD is once again leading the crypto market rally.
“Solana, as usual, performed better on Bound,” he said.
“Now we're out of resistance on a flash arrow setup that typically starts new trends.”
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
