Solana and SOL token: Let us dig deeper
Solana is a proof-of-stake platform that hopes to become an alternative to Ethereum and other smart chain networks like Elrond and Ethereum Classic. Its platform is significantly faster than most chains like BNB since it can handle over 2,000 transactions per second. It is also energy-friendly since it uses validators to verify transactions.
SOL, its native token, is trading at $91 (on March 24), bringing its market capitalization to over $29 billion. It is the 9th biggest cryptocurrency in the world. According to CoinGecko, Solana has a supply cap of 508 million, and those in circulation are over 320 million.
Solana has been used to build all types of decentralized applications such as those in the DeFi, metaverse, gaming, and NFT industry. According to DeFi Llama, its DeFi apps have a total value locked (TVL) of over $6.6 billion. In terms of this figure, it is the fifth-biggest platform after Ethereum, Terra, BNB, and Avalanche.
Solana (SOL) price history & technical analysis
Solana had a successful year in 2021 as it became a mainstream project that attracted millions of dollars from venture capital firms. As a result, its price moved from below $5 to about $240, giving it a peak market cap of over $50 billion.
The coin’s price has given back some of last year’s gains as concerns about interest rates grow. Investors are also worried about the growing competition from the likes of Terra and Avalanche. Further, its several outages discouraged developers from using the network.
On the daily chart, Solana fell to a low of $78.6, where it found a strong support level. It has struggled to move below this point several times this year. Also, the coin has moved below the 25-day moving average and the 61.8% Fibonacci retracement level.
Therefore, since the coin is in consolidation mode, a more bearish outlook will be confirmed if it moves below the support at $78.6. If this happens, it will mean that bears have prevailed.
Solana (SOL) price prediction for a year
Solana is a promising project and its ecosystem is growing. However, a look at trends in DeFi Llama shows that other platforms like Fantom, Cronos, and Polygon are catching up to it. There are also concerns about the quality of some of the platforms in its ecosystem.
According to Digital Coin Price, Solana is expected to average about $118 in 2022. That estimate is about 35% above the current level. The additional estimate by LongForecast is that Solana will end the year at $112, which is also slightly above the present price.
Meanwhile, using the daily chart shown above, there are two main scenarios that will likely happen in 2022. If it drops below the support at $78.60, it will mean that sellers have prevailed and that the price will keep falling to below $50. On the other hand, if buyers come back and prevent it from falling below that point, it could rise to the 50% retracement at $140.
Solana (SOL) price prediction for 2025
Solana’s long-term performance will depend on the growth of its ecosystem and whether more developers will embrace it. Also, the price will be determined by the level of activity in the ecosystem. Another factor will be related to the global economy and how the Federal Reserve will act. A prolonged period of hawkishness will affect high-risk assets like Solana and other cryptocurrencies.
According to Long Forecast, Solana will continue doing well by 2025. It estimates that the coin’s price will end 2025 at about $274, which is significantly higher than where it is today. Digital Coin Price estimates that it will average $173 in 2025. A conservative estimate is that it will retest its all-time high of $262 by 2025.
Solana (SOL) in questions & answers
Is Solana coin real?
Solana is a real cryptocurrency that has a market cap of over $29.1 billion. It is used widely to provide governance to the ecosystem and staking.
Will Solana reach $1,000?
It is unlikely that Solana will reach $1,000 in the near term, considering that it is now below $90. In the long term, the coin will likely keep growing depending on how developers embrace the ecosystem.
Should I buy Solana coin?
At this point, Solana is at a key support level and is in a consolidation phase. As a result, the coin could have a bearish breakout. Therefore, it is recommended that you wait before you buy it. A move below the support will see it drop sharply in the near term.
How much will be Solana be in five years?
Solana’s performance will be determined by the overall acceptance by investors and developers and the market action by Bitcoin. Historically, most altcoins tend to move in the same direction as Bitcoin. Therefore, since Bitcoin is estimated to be at over $100,000 in five years, Solana will also be at elevated levels in that period.
Where do I buy Solana?
You can buy Solana in leading exchanges like Coinbase, Binance, Kraken, and Crypto.com.
This article represents the views of the author. Cryptocurrencies are highly speculative assets and the author will not be held liable for any losses.
