Solana Outperforms Bitcoin with 38% Monthly Returns, as Robinhood Fuels Demand by Offering Staking
Summary:
Solana (SOL), experienced a 14% value increase in the past day, with a monthly return rate of 38%, outperforming competitors like Bitcoin. This increase can be attributed to factors such as decreasing U.S. bond yields and encouraging news events. Robinhood has aided the situation by announcing it will allow European customers to stake SOL on their platform, which has increased demand for the coin. Furthermore, SOL's recent gains have been bolstered by the latest U.S. Consumer Price Index report and the growing coin launches on Solana's platform.
The Solana network's own digital coin, Solana (SOL), experienced a 14% value increase in the past day, peaking at roughly $163.50 on May 16. Over the past month, the digital currency has enjoyed a return rate of around 38%, outdoing major competitors including Bitcoin (BTC). Many factors such as decreasing U.S. bond yields, signaling a heightened preference for riskier assets including cryptocurrency, have contributed to SOL's value rise in May. Furthermore, SOL's demand among speculative traders has been spurred by encouraging news events.
The U.S. trading service, Robinhood, while preparing for legal confrontations domestically, is focusing its attention on European clients to extend its crypto services. On May 15, Robinhood launched its inaugural crypto-staking product, designed exclusively for its European users. As per an official statement, customers of Robinhood can now stake Solana and earn a 5% yield via the app. Other platforms offering SOL staking, such as Kraken and Binance, promise yields of 5% and 8% respectively.
Stakers gain passive rewards from their holdings to back the network. Staking involves locking up their tokens to endorse transactions and secure network operations. Robinhood's latest announcement bolstered investor faith in Solana. Being recognized by a significant platform like Robinhood greatly underscored the potential and stability of Solana's cryptocurrency.
Additionally, the potential of securing a 5% yield via staking might have persuaded more individuals to purchase and retain SOL, thus depleting its accessible supply in the market and leading to a price surge.
SOL's past day's earnings seem to be impacted by the recent U.S. Consumer Price Index (CPI) report. It is worth mentioning that from March, core inflation increased by 0.3%, in line with consensus estimations, ending a three-consecutive-month run of surpassing projected readings and causing concerns about entrenched inflation. Reaction to this saw the U.S. 10-year Treasury note yield decline from 4.44% to as low as 4.31%.
Investors often opt for better risker returns when safe-haven assets such as Treasuries offer lower yields, including cryptocurrencies. Since April, over a million new tokens have emerged, with over 370,000 new tokens introduced on Ethereum and over 640,000 on Solana.
As per Dune Analytics dashboard pump.fun, 466,914 of the 643,000 new coins on Solana were memecoins. The increase in Solana's token launches corresponds with a rise in the total locked-in value (TVL) across its platform, going from 23.75 million SOL on April 1 to 28.90 million SOL on May 15.
The flood of new tokens, particularly memecoins on Solana, shows greater activity and the platform's escalating adoption. More token launches generally mean an uptick in transactions and network usage, thus driving SOL's demand.
SOL's recent gains can be seen from a technical viewpoint, as they came after testing the 100-day exponential moving average (100-day EMA) as a base of support. Also, the upward moves form part of what appears to be a cup-and-handle pattern. SOL's price seems to be in the breakout phase of the pattern after completing above its neckline resistance of roughly $158. The digital currency is primed for a trajectory toward $206 in May, a more than 26% rise from current price levels.
The content of this article does not provide any investment advice or suggestions. All investment and trading activities bear risk, and individuals should conduct their independent research before making any decisions.
Published At
5/16/2024 2:05:23 PM
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