Solana Upward Trend Falters – Is Optimism Nevertheless Permitted?

Solana (SOL) remains critically observed until further notice, the insolvency of the crypto exchange FTX at the beginning of November has triggered domino effects and raised doubts about the future viability. In the first two weeks of January, Solana was still able to pump, helped by the launch of the meme coin BONK in SOL’s ecosystem. However, now, the fresh momentum at Solana seems to have evaporated, with the price level now stagnating again at around $23.

Solana currently finds reason for optimism in the NFTs division, where it has moved up to second place among the most important ecosystems behind Ethereum (ETH) in terms of weighted turnover, according to data from Delphi Digital. An NFT project at BONK also exceeded expectations. However, some particularly popular NFT collections under Solana, such as DeGods and y00ts, have announced plans to switch technologically to Polygon (MATIC), which is likely to cost market share.

If you want to read more details about Solana ‘s price and to find the latest business news from around the world, download for free our companion app. Available for free, for both Android and iOS devices, the Born2Invest mobile app keeps its readers up to date with the latest updates in the crypto market and not only.

Solana’s decentralized division

The outlook seems similarly divided in the Decentralized Finance (DeFi) division, which is important to Solana. Here, according to DeFiLlama, an inflow of about $50 million in capital was counted in January. But Solana’s TVL is now just over $260 million – up from more than $1 billion before the FTX crash.

Experts also pointed out that developer activity at Solana is down significantly, as measured by Samtiment. Here, it is becoming apparent that Solana developers are switching to other ecosystems such as Polygon or Ethereum, as higher budgets and user numbers are enticing there. Solana has little to counter this exodus; the days of almost blindly funded projects by Sam Bankman-Fried, FTX, and other allies are probably irrevocably over.

Conclusion: 2023 will be a decisive year for Solana

Solana, as far as we know, is not to blame for the collapse of the FTX empire, but the motto “along for the ride” still applies to SOL. At least 10 percent of all SOL continues to be stored in FTX’s insolvency estate, and a sell-off could cause the price curve to plummet.

On the other hand, there are initiatives such as BONK to make Solana’s ecosystem more attractive and to prove that it can find its way back to success under its own steam. 2023 will show where Solana is headed.

__

(Featured image by GuerrillaBuzz Blockchain PR Agency via Unsplash)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in BLOCK-BUILDERS.DE, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.