Solana’s SOL token has experienced a 20% gain between September 28 and October 6, indicating a double-digit recovery since September. This recovery can be attributed to improving fundamentals rather than being solely driven by Bitcoin’s movement. Prior to the price breakout, SOL faced a turbulent period after a U.S. court approved the sale of $1.3 billion in SOL from the bankrupt exchange FTX. However, confidence among bulls emerged as SOL reestablished support at $20 on September 29, coinciding with a successful upgrade to version 1.16.
The rally in SOL’s price is also supported by the growth in decentralized applications (DApps) and nonfungible token (NFT) volumes on the Solana network. Solana’s DApp and NFT market activity has surged, with active addresses engaging with DApps exceeding those of Ethereum. Solana’s cost-efficient and scalable solution in the NFT market has contributed to its success, as it allows for more viable production in larger quantities with lower minting fees.
Additionally, a network upgrade to version 1.16 introduced a “gate system” and “confidential transfers” to enhance network stability, user privacy, and security on the Solana blockchain.
Despite Solana’s progress, Ethereum layer-2 solutions have gained more traction in terms of total value locked (TVL) and activity. External factors, along with the FTX bankruptcy drama, make it challenging for SOL to breach the $23 resistance level. Investors remain focused on the Ethereum ecosystem due to its leadership in developers and consolidated decentralized applications.
Summary:
– Solana’s SOL token has staged a double-digit recovery since September.
– The recovery is driven by improving fundamentals rather than Bitcoin’s movement.
– Confidence among bulls emerged as SOL reestablished support at $20 and successfully upgraded to version 1.16.
– Solana’s rally is supported by growth in DApps and NFT volumes on the network.
– Solana’s cost-efficient and scalable solution in the NFT market has contributed to its success.
– A network upgrade to version 1.16 enhances network stability, user privacy, and security.
– Ethereum layer-2 solutions have gained more traction than Solana in terms of TVL and activity.
– External factors and investor focus on the Ethereum ecosystem make breaching the $23 resistance level challenging for SOL.