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- Solana is a protocol that is a contender for the future
- SOL is the native token with an over $47 billion market cap
- The seventh-place token in the top 99.9% of the asset class
- SOL did a lot better than Bitcoin and Ethereum during last week’s correction
- Burning tokens or new smart contract features have lifted SOL’s value
Trading or investing in cryptocurrencies can be like riding a psychotic horse through a burning. Just as Bitcoin and Ethereum appeared ready to challenge the all-time highs from May and June, the prices ran out of upside steam and tanked on Sept.7. Ethereum dropped more than Bitcoin, but Bitcoin put in a bearish key reversal trading pattern on its daily futures chart on Tuesday, Sept. 7. The two leading cryptos now face lower highs, which is not a bullish technical sign for the asset class.
Meanwhile, the extraordinary price variance could easily make last week’s price action a flash in the pan on the way to new highs. Bulls are looking at the move as an opportunity while bears are issuing, I told you so warnings.
Solana SOL is one of the up cryptocurrencies that recently jumped ahead of Dogecoin ( DOGE ). During the most recent correction, SOL tokens outperformed Bitcoin and Ethereum as its profile continued to rise.
Solana is a protocol that is a contender for the future
In the world of cryptocurrencies, speed and efficiency is a critical component of success. Solana claims to be the fastest blockchain in the world and the fastest-growing ecosystem in crypto, with over four hundred projects spanning DeFi, NFTs, Web3, and others.
Solana’s website states it is “Powerful for developers. Fast for everyone.”
On Sept. 7, Bitcoin, Ethereum, and many other cryptocurrencies fell sharply. Solana outperformed the rest of the pack. A Sept. 9 article on Cointelegraph said that a $500 SOL target could be “conservative.” “With more than two different NFT project launches and minting going on in the ecosystem per day, there is an unending demand for SOL from retail buyers. As a result, it has kept the price up more than 50% this week despite a market-wide crash.”
SOL is the native token with an over $47 billion market cap
On Sept.14, SOL tokens were at the $158.80 level with a market cap of $47.356 billion.
The chart dating back to April 2020 shows the rose from below 60 cents to a high of $191.04 on Sept. 7. On Sept. 14, SOL was trading at $158.80, 16.9% below the recent peak.
The seventh-place token in the top 99.9% of the asset class
On Sept. 14, a total of 11,875 cryptocurrency tokens were floating around in cyberspace. SOL, the seventh-leading crypto, had a higher market cap than 99.94% of its competitors. SOL was one spot below XRP and one above Polkadot ( DOT ) in the market cap hierarchy.
At $47.356 billion, SOL’s market cap reflects 2.25% of the overall asset class’s market cap. Solana rose to a new record high on Sept. 7, 2021, while Bitcoin, Ethereum, and many other tokens made lower highs.
SOL did a lot better than Bitcoin and Ethereum during last week’s correction
The decline from the Sept. 7 high took Bitcoin futures to the latest low at $43,310 on Sept. 13, an 18.5% decline. However, the leading crypto fell 33.9% below its Apr. 14, 2021 record peak.
Ethereum futures fell from $4,056.25 on Sept. 3 to the latest low at $3,110 on Sept. 13 or 23.3%. Ethereum’s record high in early May was at $4,406.50. At the recent Sept. 13 low, the second-leading crypto had declined by 29.4%.
Solana (SOL) has outperformed Bitcoin and Ethereum since the recent highs this month, and their record peaks in April and May.
Burning tokens or new smart contract features have lifted SOL’s value
Solana closed 2020 at the $1.8421 per token level. SOL tokens have soared and offered fantastic returns at the recent high and over $158 per token on September 14. While the chart on Coinbase (NASDAQ: COIN ) put the record high at $191.04 level, Messari said the peak was at $214.36. It is hard to keep up with the fast-moving asset class as different platforms report varying price data. On Sept. 14, Coinbase listed SOL as the seventh-leading token, but Messari had it in sixth place, ahead of XPR.
Aside from Solana’s speed, efficiency, and wide range of projects, it has prioritized smart contracts, which are programs stored on the blockchain that run when predetermined conditions are met and automate agreements, providing outcome certainty. Moreover, the market speculated that Solana could be burning tokens, removing available coins from supplies, increasing scarcity, and driving the value higher.
Token burning is the opposite action that governments take when they increase the money supply.
Solana is a blockchain that could address some of the weaknesses in Ethereum when it comes to scalability and high transaction costs. SOL, DOT, and Cardano ( ADA ) are a group of cryptos some analysts call “Ethereum killers.”
The recent price action in SOL is another crypto success story that will continue to drive speculators looking for the next explosive token into the market. When approaching any crypto from the smallest emerging token to Bitcoin, only invest capital you can afford to lose. The high level of volatility and uncertainty of the asset class is a perfect example of how the reward potential is commensurate with the high level of risk.
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