Solana Struggles to Hold Above $110, Trails BNB Again
Solana (SOL) has been facing difficulties maintaining a strong position above the $110 mark in recent days, resulting in its capitulation to BNB once again.
Price Drop and Market Cap
Over the past 24 hours, SOL has declined by 3.8% and is currently trading at $109.5. Its market cap has also dropped from around $50 billion to $47 billion, causing it to become the fifth-largest cryptocurrency.
Increased Trading Volume
Despite the price drop, Solana’s 24-hour trading volume has seen a surge of 16%, reaching $3.3 billion.
Solana Surpasses Ethereum in Stablecoin Trading Volume
A recent report reveals that Solana’s weekly stablecoin trading volume has surpassed Ethereum’s. Solana recorded a stablecoin volume of $103 billion in seven days, while Ethereum’s volume was around $90 billion.
Increase in Social Activity
Santiment data shows that social activity surrounding the SOL token has experienced a 76% surge over the past day after consistently declining since December 24.
Declining Open Interest and Funding Rates
The total open interest in Solana has decreased by $1.3 billion to $1.26 billion within the last 24 hours. This suggests that approximately $40 million worth of SOL perpetual contracts may have been closed or liquidated at this price point. The total funding rates for SOL currently stand at 0.08%, indicating a dominance of long-position holders over short-position holders.
Rising Relative Strength Index (RSI)
The Solana Relative Strength Index (RSI) has been steadily increasing since December 30, reaching a seven-day high of 77. While many traders are betting on long positions, the RSI indicator suggests high price volatility.
Solana DEX Volume Surpasses $28 Billion
In December, Solana’s decentralized exchange (DEX) volume exceeded $28 billion. This rally was driven by airdrops and meme coin mania, which also helped the SOL token reach $120 in late December.
Hot Take: Solana’s Uphill Battle Continues
Solana faces ongoing challenges as it struggles to maintain a strong position above $110 and trails behind BNB. Despite increased trading volume and surpassing Ethereum in stablecoin trading, declining open interest and funding rates suggest potential liquidations. The rising RSI indicates high price volatility while social activity surrounding the SOL token sees a notable increase. Solana’s DEX volume surpassing $28 billion showcases its growing popularity but also highlights the influence of airdrops and meme coin frenzy. As the fifth-largest cryptocurrency, Solana remains in a competitive position but must navigate various factors to establish stability and future growth.
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