What drove Solana’s prices to a new all-time high today?

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Solana’s ground token has been on fire lately, reaching a series of new all-time highs in recent months as the platform generates widespread visibility.

The digital currency climbed to $ 219.11 earlier today, according to data from Messari.

By this point, the cryptocurrency had grown by more than 13,500% in 2021, additional figures from Messari reveal.

The digital asset pulled out soon after, trading closer to $ 212 at the time of writing.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

It is worth noting that the sol token hit its last high on the same day that the Total Locked-In Value (TVL) in DeFi projects built on the Solana platform hit an all-time high, according to data source DefiLlama. At the time of this writing, TVL’s figure had reached $ 13.67 billion.

Additionally, the value of digital currency has increased as it, and other Layer 1 tokens, has increased with bitcoin, a development reported by CoinDesk and TBEN.

However, when asked to explain the latest ground price movements, analysts who contributed to this article highlighted a series of bullish factors.

“Solana continues to progress for several reasons,” said Tim Enneking, Managing Director of Digital Capital Management.

“He’s a legitimate participant in the NFT marketplace (as opposed to a ‘hype participant’ because each token tries to claim some sort of affiliation with NFT to determine its price),” he said.

In addition, Solana is able to deliver what Ethereum has “literally promised for years (PoS, low transaction fees, greater scalability, etc.)”.

Beyond that, the association it has with the FTX cryptocurrency exchange provides tailwind.

Finally, “Solana’s percentage growth (by virtually all metrics: TVL, Twitter mentions, community size, etc.) is higher than ETH’s.”

In addition, Enneking highlighted the exchange of data.

Perhaps the strongest metric today is that $ 10 million in long leveraged positions have been opened on Bitfinex in the past 20 hours, while $ 4.5 million in short positions have been opened on Bitfinex in the past 20 hours. been closed, ”he said.

“A $ 15 million net improvement in margin positions on a single exchange is huge – and telling.”

“All of this simply leads to the conclusion that the potential benefit of SOL is greater than the potential benefit of ETH – even if ETH is looking to reach a new ATH soon,” Enneking said.

Konstantin Anissimov, executive director of CEX.IO, also weighed in on Solana’s merits.

The platform has a unique value proposition, “which creates strong competition for Ethereum and other L1 blockchains on which projects can build DeFi solutions,” he said.

“Solana offers very fast execution with fees of less than $ 0.01. This, along with a very active development community and generous developer grants to encourage further innovation, paves the way for success. ”

However, he spoke about the competition posed by the Ethereum platform.

“Solana is not the only L1 blockchain project with such a bright future.”

“And we shouldn’t forget Ethereum’s dominance in space either, regardless of the cost and speed of execution.”

Anissimov also commented on the observation that the sol token followed bitcoin higher, pointing out that the “best cryptocurrencies” typically display this kind of correlation with the world’s most important digital currency.

Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, explained the development, offering more details.

“At the moment, traders are looking for relatively safer altcoins, as future movements of BTC remain uncertain,” he said.

“If there isn’t a full-fledged ‘alternate season’, it’s natural for traders to go for assets that have performed well over the past few months and have shown they can move independently. bitcoin to some extent, ”DiPasquale said.

“Solana ranks first among these, while others include DOT, LUNA and ATOM and so on. ”

“We can expect these kinds of blue chips to work well until the market feels confident enough to invest money in riskier altcoins.”

Disclosure: I own bitcoin, bitcoin cash, litecoin, ether, EOS, and soil.

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