In recent weeks, Solana (SOL) has shown remarkable developments, making it one of the most discussed blockchain projects. From record-breaking transaction volumes on decentralized exchanges to a sharp increase in the number of transactions and the growth of total value locked in DeFi protocols, all indicate significant ecosystem growth. However, alongside these successes, there are challenges that could impact Solana’s future. One of Solana’s recent key strengths has been the increased network activity and daily transaction growth. Solana now processes about 60 million transactions daily, a stark contrast to Ethereum. Moreover, the volume of transactions on decentralized exchanges of this network reached $19.47 billion on January 19, indicating high user demand. This growth is primarily due to the launch of new tokens, especially meme coins like TRUMP and a new meme coin inspired by Elon Musk’s username on Twitter. In the DeFi sector, Solana managed to surpass Tron and become the second largest blockchain in this field. The total value locked in this network increased to $8.6 billion, with a significant portion attributed to the growth of platforms like Raydium and Serum. Another positive factor is the entry of institutional investors into Solana. Large companies like Grayscale and Bitwise have applied to launch an exchange-traded fund (ETF) for Solana. There are predictions that this ETF could be approved by the end of 2025 or early 2026. The introduction of such products into the market could increase Solana’s acceptance among institutional investors. Despite all these successes, Solana faces challenges. One of the main concerns is the intense competition with other blockchains, especially Ethereum and Binance Smart Chain. On the other hand, Arthur Hayes, the founder of BitMEX, predicts a potential price drop of Solana below $200, which is another existing concern. Although he hopes for long-term price growth of this currency, he anticipates a bearish phase in the digital currency market before any significant growth. The daily chart of Solana shows interesting developments. The price has not yet reached its key demand zone between $165 and $155, creating several support levels at this range. Another interesting point is the trading volume when Solana breaks its previous price ceiling. At that time, the trading volume significantly increases after setting a new price ceiling, leading to a drop in Solana’s price. In other words, traders start taking profits after setting a new price ceiling. Therefore, the likelihood of SOL returning to lower levels and then starting a new rally is high. Traders need to identify trading volume, price ceilings and floors, and the main market trend to capitalize on potential profits. In the short term, Solana may experience price fluctuations, but in the medium term, if the trend of network acceptance growth and the entry of new capital continue, Solana can be expected to move towards higher price levels.
