Was Solana A Q4 2023 “Bubble” That Has Popped?
08 Januar 2024 - 9:00PM
NEWSBTC
The crypto market has recently been a roller coaster, especially in
H2 2023. Solana, a high-throughput blockchain, emerged as one of
the best performers in the top 10 coins by market cap. In Q4 2023,
Solana soared, reaching highs of around $125 before cooling off to
spot rates. However, some think the uptrend is over, with SOL
edging lower under increasing liquidation pressure. The Solana
Bubble Has Popped, Is This True? Lido.eth, while taking to X on
January 7, said Solana is a “Q4 2023 bubble” that has “already
popped.” The analyst added that this formation doesn’t mean SOL is
“worthless or won’t be used anymore.” However, based on Lido.eth’s
assessment, the Solana “growth story has ended,” calling serious
questions into the project’s immediate potential. Related
Reading: Polygon NFTs Explode: 6-Month High Volume Ignites Market –
Details In H2 2023, Solana grew on renewed interest in the
high-performance blockchain. Propelled by rising activity in
decentralized finance (DeFi) and non-fungible token (NFT) scenes,
SOL reversed losses recorded in November 2022. Moreover, as the
crypto community tracked the Securities and Exchange Commission
(SEC) and whether they would approve the first spot Bitcoin ETF,
altcoins, including SOL, became major beneficiaries. Arthur Hayes,
the founder of the cryptocurrency exchange BitMEX,
also believes that the Solana rally is over. In December
2023, Hayes tweeted that he had rotated funds from Solana to
Ethereum, citing “divine inspiration.” The BitMEX co-founder also
said ETH may rally to reach $5,000 but without giving a specific
timeline as to when this lofty target will be reached. SOL Remains
In An Uptrend, Back To $125? Despite these bearish sentiments, some
Solana supporters believe the platform has a “bright future.” They
point to the upcoming launch of the Firedancer client. This
validator client will make the network more robust and increase
efficiency. It will aim to decentralize Solana further, making it
more reliant by eliminating weak points resulting from client
concentration. From a price action perspective, continuing the
overall crypto uptrend could also buoy SOL prices in 2024. Related
Reading: Analyst Predicts $570 Billion Inflow Amid Bitcoin Spot ETF
Approval Looking at the Solana price chart, the uptrend remains,
but sellers dominate, at least in the short term. To quantify, SOL
is down 30% from the December 2023 peak when it topped at around
$125. With prices trending inside the bear bar of January 3,
sellers have the upper hand from an effort-versus-result
perspective. For the uptrend to resume, there must be a clear,
high-volume close above $100. If not, steep losses below $85 might
trigger a sell-off that could price toward $60 or worse. Feature
image from Canva, chart from TradingView
Polygon (COIN:MATICUSD)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Polygon (COIN:MATICUSD)
Historical Stock Chart
Von Jul 2023 bis Jul 2024