- Memecoin prices, a spike in Solana network activity, and positive derivatives markets could all indicate that SOL is targeting $180.
The native token of Solana, SOL tickers down $161, saw a 13% increase in value between July 14 and July 16, surpassing the $160 resistance mark for the first time in the previous five weeks.
Nonetheless, SOL’s value is still 24% below its March top of $209, so bulls have little cause for excitement. The uptrend’s longevity and the likelihood of a short-term retesting of the $180 level are currently being questioned by traders.
Memcoin craze in Solana and the momentum of Ether ETFs
The last wave of Ether exchange-traded fund (ETF) clearance is partly responsible for the enthusiasm around SOL. As it gets ready to start on July 23, the US Securities and Exchange Commission (SEC) reportedly gave asset managers their final set of instructions.
On July 8, VanEck and 21Shares submitted an application for a comparable Solana ETF; the SEC is anticipated to make a decision by March 2025.
Memecoins make up a sizable portion of Solana’s ecosystem because of the network’s cheap launch and trade costs. Memecoins like DogwifHat (WIF) and BONK, which reached peak market capitalizations of $2.8 billion and $4.8 billion, respectively, have benefited from this. More significantly, Solana has created a community that is vibrant and engaged, something that is difficult to duplicate.
Over the last seven days, a number of Solana SPL meme coins have shown remarkable gains: MICHI (up 71%), POPCAT (up 70%), MYRO (up 36%), and TRUMP (up 30%).
These moves encourage new investors to join the market, which in turn raises the demand for SOL tokens because of the rise in the activity of decentralized apps (DApps) and improved liquidity of the Solana ecosystem, which includes its total value locked (TVL).
With respect to the volumes of decentralized exchanges (DEXs), Solana is presently the second-largest blockchain. It is catching up to Ethereum, the market leader, which is currently trading at $3,501.
Ethereum has unfair competition due to its $2.3 average transaction fee, but even with Arbitrum and BNB Chain sharing the same incredibly cheap costs, Solana DEX activity is noteworthy.
It’s also important to note that Base, the Ethereum second layer that gained notoriety for the introduction of meme coins and tokens, has suffered a drop in volume. DefiLlama data shows that Base’s weekly market share has dropped to 3.6% from a peak of 10.8% on June 8.
The premium Solana TVL growth and SOL futures markets
The increase in Solana’s total value locked (TVL) is indicative of its active growth, outpacing that of BNB Chain. Since a larger deposit base boosts network security and creates a positive feedback loop that draws more users and developers and raises token valuation and growth potential, it is generally regarded as bullish.
Highlights on the Solana network include Kamino, a lending and leverage solution, which saw a 12% growth in deposits in the same period, and Jito, a liquid staking solution, whose TVL climbed 14% in 30 days. Finally, over the previous 30 days, TVL for DEX aggregator Jupiter Perpetual increased by 28%. Comparatively, the top BNB Chain DApps, Venus and PancakeSwap, saw TVL declines of 5% and 7% within the same time period.
Finally, it is important to examine SOL’s futures markets. The monthly contracts’ derivatives pricing and the spot level on conventional exchanges are represented by the SOL futures premium. A 5% to 10% annualized premium, or basis, is usually applied to offset the longer settlement period. To put it simply, a larger premium indicates a bullish mindset among traders who are willing to pay more for future contracts.
The SOL futures premium is currently 12%, as it has been for the last few days. This suggests that traders are feeling cautiously hopeful, which is particularly pertinent given that SOL has increased by 25.7% over the last eleven days. Based on the active Solana network and derivatives indicators, SOL appears to have what it takes to sustain its gains in the $180 range.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
