Ethereum Competitor Solana Sees Institutional Inflows
Solana, a competitor to Ethereum’s Layer-1, has been attracting significant institutional investments in recent weeks. In September, the price of Solana surged past $23 as institutional inflows strengthened. Last week, Solana experienced its largest weekly inflow in months, reaching $24 million. This influx of investment solidifies Solana’s position as a preferred alternative cryptocurrency, especially following recent Ethereum product launches.
Inflows into Digital Asset Investment Products
Data from CoinShares reveals that digital asset investment products received inflows totaling $78 million last week, marking two consecutive weeks of positive flows. Additionally, trading volumes for Exchange-Traded Products (ETPs) increased by 37% during the same period, reaching $1.13 billion.
Solana Price Action
After a strong rally in late September, the price of Solana (SOL) retraced slightly and failed to reach $25. Currently trading at $22.25 with a market cap of $9.2 billion, SOL is down by 5% over the past 24 hours and 7.6% on the weekly chart. Despite this drop, Solana remains the seventh-largest cryptocurrency by market valuation.
Indicators Suggest Potential Breakout
Although SOL’s performance has dipped recently, its indicators remain positive. The crossover of SOL’s 30-day exponential moving average above its 200-day average indicates the potential for a breakout in the near future. Additionally, SOL’s relative strength index remains above 50, suggesting continued buying momentum. The altcoin’s support level has also increased since September, further strengthening its position.
Solana’s Strong DeFi Performance
Nansen, a blockchain analytics firm, reported that the total value locked (TVL) on the Solana blockchain now stands at $30.95 million. The TVL for DeFi on Solana has nearly doubled since the beginning of 2023. This growth in transactions and TVL demonstrates Solana’s capacity for robust economic activity. Solana’s improvements in fee markets and state compression have also resolved significant issues within its technology infrastructure, resulting in a substantial reduction in NFT minting costs.
Hot Take: Solana Continues to Attract Institutional Attention
Solana’s recent institutional inflows and strong performance indicate its growing popularity as an alternative cryptocurrency. Despite a slight price drop, SOL’s indicators suggest potential for a breakout and continued buying momentum. Additionally, Solana’s advancements in DeFi and technology infrastructure have positioned it as a competitive player in the market. As institutional interest in cryptocurrencies continues to rise, Solana is likely to attract further attention and investment.
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