The Rise of Solana: Buying Pressure on Coinbase Drives Rally
The price of Solana (SOL), a smart contract platform, has surged by almost 300% this year and over 50% in the past two weeks. Much of this rally can be attributed to buying pressure on Coinbase, a leading cryptocurrency exchange listed on the Nasdaq.
Data from Kaiko reveals that there has been a significant increase in cumulative volume delta (CVD) flowing into SOL on Coinbase, indicating more buying than selling. Binance and Kraken have also experienced positive net flow earlier this week, while Upbit, a South Korean exchange, has seen negative and falling net flow for two weeks.
CVD is a measure of the net buying and selling volume, reflecting the market’s bullish or bearish forces. Positive CVD values indicate buying activity, while negative values suggest selling activity.
Institutional Accumulation on Coinbase
According to Kaiko analyst Riyad Carey, SOL’s average order size on Coinbase has been higher compared to other exchanges, suggesting that institutional players may be accumulating SOL through Coinbase. This indicates strong buying interest from institutional investors on the platform.
Furthermore, investment products focused on Solana have experienced a 74.1% increase in assets under management in October, reaching $140 million. This growth highlights the growing popularity and demand for Solana among investors.
Bullish Case for Solana
Coinbase’s prominent position in the SOL market coincides with VanEck’s bullish prediction for the cryptocurrency’s price. VanEck, an institutional asset manager overseeing billions of dollars, believes that SOL could reach as high as $3,200 by 2030.
This optimistic forecast is based on the scenario where Solana becomes the first blockchain to host applications with over 100 million users. Notably, the total value locked in Solana’s decentralized finance (DeFi) protocols has increased from around $200 million to approximately $414 million.
However, in terms of SOL, the total value locked has actually decreased from around 12 million SOL to 10.33 million SOL, according to DeFiLlama. This indicates that the growth in US dollar terms is primarily due to Solana’s impressive price surge of nearly 300% this year.
Hot Take: Solana Rides Coinbase Wave to New Heights
Solana’s remarkable performance can be attributed to its association with Coinbase and the increasing interest from institutional investors. With its strong buying pressure on Coinbase and growing assets under management, Solana has emerged as a popular choice in the crypto market.
The bullish case for Solana’s future growth further enhances its appeal. As it continues to attract more users and lock in higher value in its DeFi protocols, Solana’s potential as a leading smart contract platform becomes even more promising.
By
By
By
By