thecoinrepublic.com
- Solana, the ninth most valuable cryptocurrency by market capitalization, had a 311 percent three-month ROI vs. USD
- In fact, Solana has dropped to sixth place (by market cap ranking) after seeing a nearly 42 percent price decrease from its all-time high. Furthermore, during the recent shake-ups, other altcoins like Avalanche, Cosmos, and LUNA performed significantly better than SOL
- This, together with Solana’s network shutdown on September 14, served as catalysts for the company’s downhill spiral
Solana, the ninth most valuable cryptocurrency by market capitalization, had a 311 percent three-month ROI vs. USD. Over the course of one and a half months, Solana’s price increased by more than 750 percent. The market’s expectation of Solana hitting another ATH evaporated when SOL posted significant weekly losses. When comparing Solana’s performance to the best-performing stock (market capitalization more than $10 billion) in 2021, a Nasdaq report pointed out that SOL outperformed AMC Entertainment by five times. On paper, Solana appeared to be more successful than the year’s most successful meme stock, but worrisome indicators and market-wide consolidation did not spare the cryptocurrency.
In fact, Solana has dropped to sixth place (by market cap ranking) after seeing a nearly 42 percent price decrease from its all-time high. Furthermore, during the recent shake-ups, other altcoins like Avalanche, Cosmos, and LUNA performed significantly better than SOL. Solana’s trading volumes have also plummeted by over 60% since its ATH. So, why was SOL having trouble? The Solana network may have been boosted by Ethereum’s high average transaction cost, which has reached $40, as well as increased interest in the NFT marketplace. However, when the NFT craze faded, SOL’s surge appeared to stall as well. This, together with Solana’s network shutdown on September 14, served as catalysts for the company’s downhill spiral.
This resulted in a drop in positive sentiment towards Solana on social media. Solana has been the subject of great social expectation in recent months, owing to back-to-back price ATHs. SOL’s difficulties were exacerbated by macro-events such as China’s crypto prohibition, SOL’s network outage, and declining trading volumes. Despite the pullbacks, Solana’s futures market recorded a high aggregate open interest (OI) of approximately 877 million, representing a more than 600% growth in just two months. While the data indicates investors’ interest, SOL’s futures market had more shorts than longs at the time of writing. SOL shorts accounted for around 60% of the market, while longs accounted for 40%.