Is Solana's New ATH a New Beginning?

Slightly over a year ago, Blockhead was convincing its readers why Solana could reach the seemingly elusive $30 mark after spending most of 2023 in the sub-$20 range. Fast forward one year and a bit, SOL has reached a new high of $263. That's a 1,040% return on Solana's price at the time of publication if anyone's counting.

Not to say that we're cryptic crypto gurus or anything (or perhaps we are) but Solana's stellar 2024 is certainly not without merit and by all measures is overdue.

Solana last hit its all-time high back in 2021, leaving a 1,111 day gap between its two most recent all-time highs. With a current market cap of $120 billion, Solana is bigger larger than the likes of Sony, Starbucks, UPS, Boeing, and Nike.

ETF Hype

Bitcoin ETFs have proven to be incredibly successful products among institutional investors and the excitement of Solana ETFs being ushered in is beyond palpable. Bitwise, which recently became the fourth asset manager to submit its regulatory filings for the product, is exceptionally keen on Solana.

Speaking to Blockworks, Bitwise CEO Hunter Horsley described SOL as "an incredible emerging asset and story," highlighting that Bitcoin ETF buyers might e looking for the "next big thing in crypto" and for a lot of investors" the answer is Solana.

Canary Capital filed for its Solana ETF in October while VanEck and 21Shares filed theirs in June.

Memecoin Frenzy

According to Blockworks, 80% of Solana's decentralized exchange activity is focused on memecoins.

"Speculative meme tokens have largely been the story of Solana’s massive run-up in volume and blockspace demand. Solana founders and investors will often portray memecoins as a “stress test” for the network — presumably as it readies itself to onboard more meaningful financial activity," Blockworks stated.

BRN analyst Valentin Fournier further explained that the strength of memecoin trading cannot be underestimated.

"While we don't believe the frenzy can withstand a bear market, memecoin trading is nothing less than an online casino driven by a strong community feeling. This alone can sustain strong transaction levels, even if markets were to go down," he said. "Platforms like Pump.fun are booming, with record-breaking active addresses and a steadily growing user base."

That said, Pump.fun doesn't come without problems. From criminal acts to child abuse, extreme content on Pump.fun has prompted calls for more regulation on the memecoin industry, which is becoming increasingly depraved.

Beyond the Craze

Memecoins and ETFs might be top of mind for Solana but underneath the new shiny products lies a rugged infrastructure, which is proving to be increasingly encouraging.

"Solana is proving itself as a reliable, developer-friendly network capable of handling massive transaction volumes," BRN's Fournier explains. "The downtime issues that weighed on its growth seem to be a thing of the past with only one downtime in the past 18 months."

As #Bitcoin flirts with $100K, #altcoins are making waves, and memecoins are stealing the spotlight. #Solana just hit a new all-time high, riding the momentum of a memecoin frenzy.
— BRN (@thebrn_co) November 25, 2024

Additionally, the likes of Solana's second validator, Firedancer, are strengthening its ecosystem, offering developers more compelling reasons to adopt Solana.

"With the recent launch of Firedancer, Solana’s getting even stronger, improving speed and reliability which could lead it toward much higher territories," Fournier said.

For full access to BRN insights, register your interest here.

Elsewhere

Blockcast

This week's Blockcast features Independent Reserve CEO Lasanka Perera, who reflects on his journey of volatility, difficulties, uncertainty, and ultimately, success.

Perera, who's also an avid golf fan, discusses how and why Independent Reserve sponsored accomplished Singaporean golfer Shannon Tan, and how the exchange is helping young people invest in crypto.

Additionally, as a seasoned crypto investor who's seen countless bull and bear markets, Perera shares his immediate reactions to the market's recent pump post-US election.

Previous episodes of Blockcast can be found on Podpage, with guests like Peter Hui (Moongate), Luca Prosperi (M^0), Charles Hoskinson (Cardano), Aneirin Flynn (Failsafe), and Yat Siu (Animoca Brands) on our most recent shows.

Events

Consensus (Hong Kong, 18-20 February)

Consensus is heading to Hong Kong, bringing together the industry’s most important voices from East and West for pivotal conversations and deal-making opportunities.

Consensus Hong Kong convenes global leaders in tech and finance to debate pressing issues, announce key developments and deals, and share their visions for the future.

Use promo code BLOCKDESK20 at checkout for a 20% discount on tickets here.

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