- SOL’s prices could rise or fall depending on the network activity.
- Demand dynamics could protect it from further downside.
Solana In 2024 the ecosystem is growing rapidly, mainly due to memecoin and deFi. The network’s TVL and stablecoin growth are also quite impressive. Are these observations a good indicator of what SOL will do with its price?
DeFiLlama reports that Solana’s TVL metrics and stablecoin marketcap have risen rapidly this year. To put things in perspective, TVL peaked at $1.396bn towards the beginning of 2024. Stablecoin marketcap reached a low of $1.83bn YTD.
According to our most recent assessment, Solana’s stablecoin marketcap is $3.22 billion and its TVL $5.29 billion. Both metrics have now reached their historical highs. It’s still not over.
Solana’s stablecoin’s recent rally has pushed the marketcap to an all-time high, just before mid July. It peaked at $$.4billion on 12th of July. TVL also continued to increase despite an overall decline. It was an indication that liquid funds were flowing out of stablecoins and into the DeFi eco-system.
How rising TVL can signal a higher demand for SOL
TVL is growing despite a decrease in stablecoins marketcap, which suggests holders have more confidence in Solana DeFi’s ecosystem. In that case, the increased demand for DeFi Tokens could also drive the price of SOL. This would make it more resistant to the downturn.
SOL could be heading to another explosive breakout. SOL briefly entered overbought land a couple of days ago, but our analysis indicates that bulls could maintain their dominance. This stock has just come out of a phase of correction and yet, it is still close to the YTD peak.
Second, it broke recently above a level of descending resistance. This could signal a new upward extension.
The strong demand for SOL in its DeFi eco-system could lead to a breakout bullish.
Solana’s on-chain Between March and April, both volume and revenue data slowed. Data from May onwards suggests the metrics are recovering.
Volume and revenue numbers confirm the signs previously highlighted of increasing network activity.
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Source: ambcrypto.com