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Solana (SOL) hit a new all-time high (ATH) of $262, marking a historic rebound after three years of turbulent price action. Notably, the token fell to as low as $8 at the height of the FTX exchange crash and the ensuing cryptocurrency bear market.
Solana makes historic recovery and eyes US dollar decline
Solana (SOL), the much-touted “Ethereum killer,” is back in the spotlight. After dominating the cryptocurrency bull market of 2020-2021, digital assets saw their value decline following the stunning collapse of FTX, led by Sam Bankman-Fried. However, SOL has made an impressive comeback over the past two years.
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At the time of writing, SOL is the fourth largest cryptocurrency, with a stated market capitalization of over $123 billion. The market cap of the top-tier blockchain is just $8 billion, which is less than surpassing the $130 billion market cap of stablecoin Tether (USDT).
Notably, SOL needs an additional 10% price rise to decisively increase USDT’s market capitalization and become the third largest digital asset by market capitalization. SOL will trail only Bitcoin (BTC) and Ethereum (ETH) as the third largest cryptocurrency.
Given the token’s recent price trajectory, it would not be surprising to see SOL surpass the market cap of the leading stablecoin before the end of the year. In the past three weeks alone, the token has seen a remarkable 75% rise, rising from $148 on November 4 to $259 at the time of writing.
While the broader cryptocurrency market has gained momentum following the victory of pro-crypto US Republican presidential candidate Donald Trump, attributing SOL’s rise solely to this would be disingenuous.
Memecoin craze, increased network activity, ETF potential helped SOL
The remarkable transformation achieved by SOL can be linked to several factors that have stimulated increased adoption of the network. One of the most prominent contributors is the ongoing memcoin craze, which has emerged as the dominant narrative in the cryptocurrency market.
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Memecoins – especially those based on the Solana blockchain – have emerged as the biggest story in the cryptocurrency market over the past year. In October alone, the total market cap of Solana-based memcoins was raised Transgression 10 billion dollars.
This memecoin craze has also been translated into It escalated Network activity for Solana. Between September and October, Solana saw a 42% month-over-month increase in active addresses, amounting to about 123 million.
Besides benefiting from the memcoin narrative, Solana also testified more DeFi activity throughout the year. According to Devilama DataSolana is home to the second largest DeFi ecosystem in the world, with a total value locked (TVL) of $9.265 billion.
Additionally, there are increasing possibilities for a Solana-based exchange-traded fund (ETF). Recent report Pointing The SEC is in active talks with several asset managers regarding the potential launch of the new Solana Spot ETF.
While SOL’s achievement of a new ATH is impressive, experts He believes The token still has great growth potential. At the time of writing, SOL is trading at $259, up 6.2% over the past 24 hours.
Featured image from Unsplash, charts from DefiLlama.com and Tradingview.com