Solana (SOL) Price Rises Amid ETF Filing and Continuous Airdrop Activities
Summary:
The price of Solana (SOL) is showing a positive trend despite broader market uncertainties. This increase is attributed to VanEck's filing for a Solana-based Exchange-Traded Fund (ETF), which would be the first of its kind and has invigorated the investor sentiment towards Solana. Further, continuous airdrop activities within the Solana ecosystem, such as the launch of a new token by Solana-based DEX Zeta Markets, are contributing to the coin's strength. Lastly, SOL's market structure suggests it could revisit the $200 mark soon.
The price of Solana (SOL) is experiencing an increase today, showing a positive movement as most of the cryptocurrency market rises, even amidst concerns over potential selling pressures due to the substantial amount of Bitcoin being transferred to centralised exchanges. At the time this report was written, SOL was trading at $149, showing a 8.9% rise in the past 24 hours.
Why is Solana increasing in price today? Here are some reasons.
Firstly, institutional investors are showing interest in a Solana Exchange-Traded Fund (ETF). Information from Cointelegraph Markets Pro and TradingView indicates that SOL experienced a significant uptick from a low of $135 to an intraday high of $151 on June 27, which is a 12% climb. This corresponds with the news that investment management firm, VanEck, has applied for a Solana spot ETF in the U.S.
VanEck is known to be one of the initial issuers of spot Bitcoin ETFs in the United States and is now the pioneer firm to request an ETF that would follow Solana's price. Matthew Sigel, the head of digital assets research at VanEck, made an announcement on June 27 stating that VanEck had applied for the first Solana ETF in the U.S., called the VanEck Solana Trust. The Trust aims to leverage on Solana's economic feasibility, decentralized nature, and high utility.
This development follows approvals by the U.S. Securities and Exchange Commission (SEC) for spot ETFs for both Ethereum and Bitcoin. The SEC stamped the approval of 19b-4 forms for Ethereum spot ETFs last month and only needs to endorse registration statements for the trading to commence. Analysts anticipate this could happen as early as July 2nd. Bitcoin spot ETFs were approved back in January and have since received an inflow of more than $14.4 million, leading to over $52 million in managed assets, according to data from Soso Value. By extension, any approvals for Solana’s spot ETFs are expected to have a positive impact on SOL's price.
Secondly, the launch of a native token by Solana-based DEX Zeta Markets is reviving Solana's airdrop fever. SOL's value has been on the rise over the past year, with its smart contract token gaining more than 780% in the last 12 months and 45% year-to-date. Said growth can be attributed to successful airdrops, leading to the creation of various Solana-based tokens.
Now, Zeta Markets, which is renowned for derivatives trading, is set to add to this momentum with the release of its new token, ZEX, and an open airdrop claim. According to reports, the airdrop is designed to reward early users of the protocol and foster long-term involvement.
The continuous airdrop activities within the Solana ecosystem suggest that developers are actively contributing to the strength and integrity of Solana’s blockchain. As a result, Solana's total locked value (TVL) rose by 120% in 2024, amounting to $4.48 billion. This suggests an increase in user and developer engagement with the Solana network, which translates into a demand for the cryptocurrency and consequently highlights the network’s robustness and growth in popularity. This positive sentiment could lead to an uptick in buying interest, thus driving the price up.
Lastly, SOL's market structure suggests it might hit the $200 mark again soon. SOL’s current price movement suggests a v-shaped recovery pattern. The 20-day exponential moving average (EMA) at $143.5 presently acts as immediate support with the relative strength index (RSI) heading towards the 70 mark, pointing towards a market dominated by buyers.
However, if SOL fails to maintain above the 20-day EMA at $143, this could indicate an inability to sustain its upward trend in which case the coin could fall to the pattern’s low at $126, thereby disqualifying the current positive outlook. This is to remind readers investment and trading involves risk, necessitating careful research before making decisions.
Published At
6/27/2024 8:34:02 PM
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