Solana total value locked and transactions recover, likely to catalyze SOL price recovery
- Solana network’s total value of assets locked in the blockchain, climbed 50% since the beginning of 2023.
- The volume of transactions on the SOL blockchain has climbed consistently since the FTX debacle in November 2022.
- SOL price is currently in a downward trend that started mid-July 2023.
Solana, one of Ethereum network’s competitors, witnessed a 50% increase in the total volume of assets locked (TVL) on its blockchain. Solana’s TVL climbed from 205.11 million to 309.32 million since the beginning of 2023.
SOL blockchain has observed a spike in the volume of transactions on Solana, making a recovery since the FTX debacle of November 2022.
Solana bullish metrics point at likely SOL price recovery
Ethereum-alternative blockchain, Solana, is on track to recover its price with the bullish metrics, the total volume of assets locked in the blockchain and the volume of transactions on the SOL chain.
Based on data from crypto intelligence tracker, DeFiLlama, there is a consistent increase in both metrics, TVL and transactions, while SOL price attempts recovery.
TVL, Transactions and users as seen on DeFiLlama
SOL price started a downward trend in mid-July 2023, declining from $32.12 (July 14) to $20.62, at the time of writing. While the altcoin has yielded 5.8% losses for holders over the past week, SOL price is likely to begin its recovery with the bullish metrics, acting as a catalyst.
The bankruptcy of the FTX exchange in November 2022, resulted in a steep decline in both TVL and the price of the altcoin. Solana was associated with bankrupt FTX’s founder Samuel Bankman-Fried, and suffered a price drop in the following months. While traders await SOL price recovery, the altcoin’s price is up 106.92%, year till date.
Bitcoin, altcoins, stablecoins FAQs
What is Bitcoin?
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
What are altcoins?
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
What are stablecoins?
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
What is Bitcoin Dominance?
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
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Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
