- Solana’s explosive growth and rising SOL price make it a crypto powerhouse.
- Liquid staking fuels Solana’s success, attracting investors and boosting SOL value.
- Caution is advised as SOL/USD shows signs of a potential reversal in the bullish trend.
Solana’s rise in the crypto space is one worth keeping an eye on. Notably, by the end of June, the combined stake of Solana (SOL) tokens held by liquid staking protocols Marinade Finance, Lido, Jito, JPool, and Socean reached a staggering $187 million. Besides, this represented a significant surge from the year’s start, when $98 million was staked.
The figures show that these protocols currently hold an impressive 69% of the total value locked within the network, estimated to be around $270 million. Consequently, Solana is experiencing significant growth, both in terms of adoption and price appreciation.
Ripple Effect of Ethereum’s Shapella Upgrade
However, Kevin Peng, a research analyst at The Block, asserts that the broader crypto space’s growth dynamics might explain the influx into Liquid Staking Derivatives (LSDs) within Solana’s ecosystem. In particular, he points to Ethereum’s recent Shapella upgrade, which spurred liquid staking’s growth. Consequently, this phenomenon has rippled into Solana.
“Overall, LSDs have grown as a category across crypto in 2023 in large part due to the new dynamics around staking on Ethereum, though demand for these products has trickled into the Solana ecosystem as well,” said Peng.
Regarding figures, approximately 1.66 million SOL, or $31 million, has been deposited into LSD protocols this year. Hence, these increased inflows are partially responsible for the rise in liquid staking TVL.
Moreover, the price of Solana‘s native token, SOL, has increased by about 60%. This surge has significantly boosted the value of SOL deposits in liquid staking.
On the market front, Solana (SOL) recorded a weekly high of $19.88 within the last 7-days, with strong bullish momentum. At press time, SOL’s market capitalization has soared to $7,700,763,389, and the 24-hour trading volume reached $320,232,176.
SOL/USD Technical Analysis
Despite the impressive surge, traders must exercise caution, as the latest market technicals indicate. The Chaikin Money Flow (CMF) rating, which assesses the strength of money flow in and out of an asset, stands at 0.23 for SOL/USD. A stochastic RSI reading of 11.13 also hints towards an “oversold” condition on the SOL/USD price chart.
The CMF measures buying and selling pressure over a specified period by combining price and volume into one metric. A reading above zero generally suggests strong buying pressure, while a below zero indicates selling pressure. However, the current value of 0.23 could imply the possibility of a reversal or slowdown in the bullish trend.
On the other hand, the stochastic RSI, an oscillator that measures the level of a close relative to the high-low range over a specified period, stands at 11.13. A value below 20 is “oversold,” indicating that the asset is undervalued, and a correction may soon follow.
In conclusion, Solana’s rapid adoption and price appreciation, fueled by the influx of liquid staking, positions it as a promising contender in the crypto space.
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