Solana's Price Surge Amid Market Recovery Signals Increased Demand and Growth Potential
Summary:
Solana's (SOL) price is witnessing an uptick, with a significant 14% increase. The growth is against the backdrop of a decline in Bitcoin's market dominance, with traders shifting to top-ranking altcoins. Solana's Total-Value-Locked (TVL) also hit a record high, indicating increased network use and demand. The launch of two new features encouraging global online chain transactions also benefitted Solana's price. The coin's value is expected to test a 50-day moving average of $150 by the end of June, with possible price rallies if it breaks above $150.
Today, the price of the Solana (SOL) cryptocurrency is on the rise, signalling an upturn as the larger crypto market steadies following concerns about Mt. Gox's proposed repayment of Bitcoin valued at $9.40 billion. As of 25th June, Solana witnessed a notable 14% increase in its value, hitting a high of $140 - a marked recovery from its lowest point in five weeks, when it dropped to $122. This gain is set against a background of decreasing dominance by Bitcoin in the cryptocurrency market, suggesting a shift in investments from Bitcoin to leading altcoins.
The Bitcoin Dominance Index (BTC.D) experienced a substantial 1.82% drop on 25th June - the biggest daily decline since January - subsequent to the announcement of the Mt. Gox trustee's plan to repay 850,000 Bitcoin to the victims of the 2014 hacking of the cryptocurrency exchange. The proposed reimbursement has been interpreted as an indication of potential selling pressure on Bitcoin in the coming weeks, leading traders to examine altcoins - including the SOL/BTC pairing, which has increased by 14.70% since the announcement.
Even before the Mt. Gox update, SOL attracted institutional interest, as indicated by CoinShares' recent weekly report, which confirmed a net inflow of $2.7 million to Solana-based investment funds in the week ending 21st June. In contrast, Bitcoin-based investment funds saw a significant outflow of $630 million, while Ethereum, a major blockchain rival of Solana, lost $58.3 million from its funds.
There has been steady growth in Solana's network use, paralleled by bullish momentum. As of 25th June, the Solana ecosystem had a total locked-in value (TVL) of 31.11 million SOL - the highest since October 2022 - representing a 300% overall increase this year, and a substantial 350% growth from its local low of around 9 million SOL in November 2023. This increased TVL signals heightened engagement with the Solana network by users and developers, which is likely to boost demand for the cryptocurrency and raise investor confidence, driving up the price.
Following the introduction of two new features allowing global online chain transactions, SOL's value has risen. One new feature, "Blinks" (or blockchain links), allows online transactions to be integrated by turning actions performed on-chain into shareable links. These Blinks could encourage the increased use of the Solana blockchain by making blockchain transactions a more common part of internet activities, thus positively affecting the demand for SOL.
From a technical perspective, SOL price increases are a part of a recovery that began after a support confluence test at around $130. SOL is currently looking to rebound towards its 50-day exponential moving average (EMA), around $150 by the end of June. A decisive break above $150 could result in a rise in price to $200, nearly matching Solana's highest price this year. However, any significant break below the support confluence could potentially cause the Solana price to plummet to the $100 psychological support marker in July. It is important to note that every investment and trading decision entails risk, and readers are advised to extensively study their options.
Published At
6/25/2024 7:46:22 PM
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