Once touted as an Ethereum killer, Solana, the high-speed blockchain finds itself in turbulent seas. Following a March 2024 all-time high of $203, the cryptocurrency has seen a dramatic downturn and is now trading at $145. Analysts caution of a possible freefall, pointing both internal ecosystem problems and outside market influences.
Solana’s Descent: A Shooting Star Loses Its Luster
Technical signals present Solana with a depressing image. Prominent crypto researcher Alan Santana notes accompanying decreased trade volume the development of bearish candlestick patterns like shooting stars and inverted hammers. These signals point to perhaps a loss of momentum and investor confidence.
The whole cryptocurrency market is now in a correcting phase, which fuels the negative attitude even more. The industry’s barometer, Bitcoin, has dropped from its highs and brought down other digital assets with it. This market-wide slump reduces Solana’s overall demand, so driving down its price.
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Solana peaked March 2024, together with Bitcoin.
One month later, April 2024, a market correction was confirmed. This is confirmed by the fact that support broke, in this case we have a “cap” pattern.➖ Notice the shooting star,… pic.twitter.com/JKynUDENJd
— Alan Santana (@lamatrades1111) May 11, 2024
Solana’s Internal Struggles: Network Congestion And Founder Feuds
Apart from outside market demands, Solana confronts internal problems endangering its stability. Congestion on the network has occasionally hampered transaction speeds and scalability. These glitches compromise Solana’s main value offer—that of being a quicker and more effective substitute for Ethereum.
Fueling the heat, recent public spats between leaders of notable Solana-based initiatives have clouded the ecosystem with division. Such inner strife begs questions about platform long-term viability and leadership.
At the time of writing, Solana was trading at $145. Chart: TradingView
Solana: Can It Weather The Storm?
For Solana, the present offers a pivotal point of intersection. Future of the cryptocurrency depends on its capacity to negotiate these obstacles.
Some analysts, on the one hand, nevertheless find hope. Emphasizing Solana’s potential for long-term expansion, investment behemoth Franklin Templeton has named it as a possible third runner in the cryptocurrency industry.
Furthermore, the forthcoming Breakpoint conference in Singapore, a big Solana community meeting, should inspire fresh investor optimism.
Solana’s narrative is not yet finished. Whether it comes out of this storm as a strong leader or disappears into the background is yet unknown. The long-term direction of the cryptocurrency will be mostly determined in the next months.
Featured image from Reformed Journal, chart from TradingView