Solana (SOL) has embarked on an impressive run in a surprising turn of events, recording a substantial 35% surge over the past three weeks. This surge marks a significant milestone for cryptocurrency, demonstrating a potential resurgence after months of relative stagnation. Despite falling short of its previous glory, when SOL was valued at over $250 per coin in November 2021, the recent price burst brought renewed attention to the asset.
Santiment, a crypto analytics platform, shared an optimistic outlook on Solana’s performance in a recent tweet:
📈 #Solana may not be showing the $250+ price levels with industry-leading development activity like #crypto traders enjoyed in 2021. But even with reduced interest levels, $SOL has been on a +35% heater over the past 3 weeks. Check out our quick report. https://t.co/t3oz6LDGqc pic.twitter.com/11ElFiYqCw
— Santiment (@santimentfeed) July 6, 2023
The exact catalyst behind this sudden upswing remains to be discovered, as no particular exchange-traded funds (ETFs) appear to be driving the momentum. However, analysts have closely monitored Solana’s social volume, particularly on Reddit, an American social news aggregation, as it exhibited a noticeable increase earlier today. The uptick in price coincided with a Reddit post discussing Solana’s resilience, suggesting a possible correlation between social sentiment and market movement.
While the price surge is promising, trading volume has yet to significantly increase. However, even a slight climb in trading activity could provide the necessary momentum to bolster the price further. Investors and traders should watch Solana’s financing rate on platforms like Binance and DyDx. In the past, buying SOL when the short-term funding rate dramatically increased has led to beneficial outcomes. Although the asset could still experience price growth without the aid of shorts being liquidated, the probability of further gains might be diminished.
In a broader context, Solana’s social dominance has experienced a consistent decline since the beginning of the year. This decline contrasts the cryptocurrency’s previous status as a leader in Santiment’s development activity metric during 2021 and 2022. However, the perception of Solana’s development activity was questioned when in the last August, its high Github activity was reported to be artificially inflated. Despite the reduced activity levels, legitimate development is still occurring, albeit at a far slower pace compared to previous years.
In conclusion, Solana’s recent price surge has generated optimism for its future growth in the crypto market. Monitoring social sentiment and trading volume would be important factors to watch as Solana continues its journey in the cryptocurrency space.
