The digital currency realm is experiencing a real boost at the moment, with Solana's intrinsic coin SOL's value peaking to a quarter high, surpassing $26. Early Friday saw Solana (SOL) price jumping beyond the $25 mark on Gate.io, achieving its highest in three months at $26.84, a value not observed since the summer months. As of the latest update, SOL has escalated by 12% in a day, and an impressive 26% within a week, based on figures from numerous blockchain data providers.
This uptrend has halted bearish tendencies, market data revealing shorts worth over $6.2 million being cleared off. With this in mind, let’s take a look at what exactly happened and what to expect from SOL price dynamics in 2024.
SOL - The Killer
Often referred to as a rival to Ethereum, Solana operates as a proof-of-stake blockchain. It serves as a platform where developers can initiate diverse decentralized financial (DeFi) endeavors and NFT initiatives.
This impressive stride by Solana occurs in tandem with an expansive boost in the digital currency market, recording a 4.3% surge in a day, resulting in an addition of $43.3 billion in overall value.
In other market news, XRP marked an 8.4% daily rise, presently exchanging at $0.51. This upward momentum could be attributed to the SEC retracting its case against Ripple leaders Brad Garlinghouse and Chris Larsen. Both, alongside Ripple, were previously accused of breaching securities regulations via XRP sales. Simultaneously, Bitcoin experienced a near 5% daily surge, inching closer to the $30,000 mark.
This positive trend is linked to ongoing adjustments related to Bitcoin ETF proposals and predictions from industry experts foreseeing an imminent approval. Ethereum (ETH) also joined the upward rally, escalating by 4% overnight, now trading at $1,615.
Solana's Post FTX Setback
Being ranked as the 8th predominant digital coin with nearly $11 billion in market value, Solana bore significant losses following the FTX debacle last year. Its SOL coin witnessed over a 41% dip a week subsequent to the digital trading platform declaring insolvency.
By the conclusion of 2022, SOL had dropped to under $10, its lowest since early 2021. It's been climbing since, despite sporadic downturns owing to the volatile nature of the digital currency market this year.
While analyzing DeFi movements, Solana's total value locked (TVL) surpassed $338 million this month. However, this is considerably less than the nearly $10 billion recorded in late 2022.
Analyzing Solana's Price
To be precise, Solana has grown by 12.89% today, contributing to its weekly climb of 25.75%. It has also marked a 34.92% monthly upswing and is now traded at approximately $26.89, according to data on October 20.
Furthermore, a one-day technical review from the financial and digital currency analytics site, TradingView, indicates a strong purchase inclination, backed by oscillators and moving averages.
Interestingly, SOL price projections predict optimistic future values for Solana. A major driver behind the buoyant sentiment around Solana and its peers is the recent verdict by the U.S. Securities and Exchange Commission (SEC) to withdraw its case against Ripple's leadership. This move hints at a more favourable regulatory climate for the broader digital currency market.
Solana's Foray into the NFT Space
Solana's rapid growth isn't merely limited to its prowess as a blockchain platform for DeFi projects. The network has also established a solid footing in the Non-Fungible Token (NFT) arena. Leveraging its high-speed, low-cost transactions, numerous creators and collectors are turning to Solana for minting and trading NFTs. This has led to the birth of several Solana-based NFT marketplaces and projects, offering a diverse range of digital art, collectibles, and virtual real estate.
As NFTs continue to gain mainstream attention and adoption, Solana's role as a prominent platform for NFT activities is anticipated to strengthen, further augmenting its position in the digital currency ecosystem. At this point you might say that NFTs have been in a cliff-like decline and no further attention is drawn to this asset class. Well, this is where you’d be wrong because the real use case of NFTs is far beyond wonky art collections and it is the former, that continues to push the envelope of conventional industries.
Unique Consensus Mechanism
At the core of Solana's efficiency and speed lies its innovative consensus mechanism, known as Proof of History (PoH). Unlike traditional mechanisms that rely on synchronized clock systems across nodes, PoH introduces a decentralized clock by creating a historical record that proves that an event has occurred at a specific moment. This allows for greater scalability and quicker validations.
Combined with the traditional Proof of Stake (PoS) system, where validators are chosen to produce blocks based on the number of tokens they hold and are willing to "stake" or lock up as collateral, Solana ensures a high level of security without compromising on transaction speeds. This blend of PoH with PoS offers Solana a competitive edge, enabling it to process thousands of transactions per second while ensuring the network remains decentralized and secure.