Solana Soars 26.7% Amidst Bitcoin Bull Run

Published 4:58 pm Friday, March 22, 2024

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All seems set for a crypto market bull run. 

The US SEC sanctioned 11 spot ETFs in January, and Bitcoin’s price recently set a new all-time high. With all this happening, Solana has also soared about 26.7% in price recently. 

As a result, investors are increasingly speculating on the most profitable new coins to get listed on Binance, looking to Solana as a case study. 

Solana’s Current Bull Run

Designed to host decentralized, scalable applications in 2017, Solana (SOL), the Proof of Stake (PoS) blockchain and its native token (SOL) have experienced ups and downs in the market. It now appears to be set for a bull run, having soared 26.7% recently.

Per CoinMarketCap data, Solana’s live price on March 4, 2024, was $132.15, with a 24-hour trading volume of $3391647641.40. It is currently one of the few altcoins exhibiting upward trends similar to Bitcoin’s, as many others remain sluggish. 

Its recent price movements suggest a powerful upward momentum, indicating a potential peak around $150 to $160 in the short term. Having formed a local resistance at $134.14, we’ve seen both short dives and spikes in recent weeks. Yet, there have been no clear signs of a reversal. As such, all seems to be set for Solana to test the peaks reached in previous years. 

Factors Responsible for Solana’s Rally

Despite reaching an all-time low of $9.43 in December 2022, many investors showed serious interest in the coin, expecting a bull run. As a result, the coin experienced huge liquidity despite its low price. This contributed significantly to its resistance and surge in the past six months. 

Consequently, many investors and market speculators are drawing parallels between Solana’s upward trend and Ethereum’s price increase during the previous bull market. In the 2020-2021 bullish cycle, Ethereum shadowed Bitcoin’s bullish momentum as we saw a price increase from $85 to a whopping $4,935. 

Now, in 2024, a similar situation is presenting itself. Bitcoin’s price currently sits at around $67k, having dropped slightly from its new record of over $73k earlier this month. In that market, Ethereum was 50% off its all-time high (ATH), just as Solana is today, and many investors speculate that we might have a repeat. This speculation, in turn, is fuelling Solana’s bull run.

Interestingly, Solana’s technical details suggest that these speculations might be correct. The total value across the Solana ecosystem is currently $2,743,838,905, making it the fifth-largest blockchain by total value locked as per Coin Gecko data. This is the first time Solana has crossed that mark since June 2022. 

Bitcoin’s Bull Run

Nevertheless, the biggest driver of this upswing remains Bitcoin. 

Bitcoin’s price is currently over 120% up from last year’s price. This bull run can be attributed to a number of factors, the legal and regulatory issues mentioned above being one of them. 

As of January 2024, the United States (US) Securities and Exchange Commission (SEC) announced the approval of 11 spot Bitcoin Exchange Traded Funds (ETFs.) Consequently, both institutional and retail investors now have new avenues for Bitcoin exposure. Investors who prefer to commit to investment vehicles as opposed to direct crypto purchases now have a leeway into the crypto market. This has attracted more capital into Bitcoin, as seen with the recent price surge. 

The upcoming Bitcoin halving next month has significantly influenced this current bull run. Bitcoin halving means mining rewards for validating transactions on the blockchain will be slashed in half. This occurs four-yearly, after every 210 blocks. Its purpose is to maintain the supply cap on Bitcoin at 21 million. As a result, when the supply of Bitcoin in circulation reduces, the demand is bound to increase, thus driving up its price. 

How does Bitcoin’s Takeoff Affect Solana and other altcoins? 

It’s simple. 

Investors are looking to make money, and the crypto market is shaping up to be one that’ll pay in a few months. So, the whole market is generally flooded with capital, and while most of that cash will go into Bitcoin, altcoins like Solana will get a taste because Bitcoin is high now. 

Knowing that investors will be flooding the market, altcoin projects look to gain attention. So, they’ll develop and deploy innovations and technologies that’ll drive interest. We’re talking new use cases and applications. 

These continuous market speculations and sentiments will continue to drive investments across other altcoins, ultimately affecting their prices.