Solana nears surpassing Binance Coin in market cap
Solana’s native token, SOL, has experienced a remarkable surge, reaching its highest point in 23 months on March 1, 2024, and is now trading up 34.5% over the past week. The token’s price increase has propelled it to the fifth spot in the cryptocurrency market cap rankings, closing in on Binance Coin (BNB) with only a $3 billion gap. This growth spurt has been accompanied by a notable rise in total value locked (TVL) in Solana’s smart contracts, indicating increased demand for its decentralized applications (DApps).
The recent price rally of SOL, which has seen a 5% increase in the past 24 hours and a 490% rise over the past year, is attributed to several factors. The token’s relative strength index suggests it has entered overbought territory, and trading volume has surged, reaching $8 billion a few days ago. Despite concerns of an impending correction, the overall market sentiment remains bullish, especially with the upcoming Bitcoin halving expected in April.
While Solana’s SOL token has been outperforming its competitors, the broader crypto market has seen a shift in interest towards more volatile assets. Traders seeking quick profits have turned their attention to the shitcoin market, with tokens like OrangePEPE ($ORANGEPEPE), Super Trump ($STRUMP), and NodeSynapse ($NS) experiencing massive gains on DEXTools. However, these tokens come with high risks, including low liquidity and potential scams, as indicated by DEXTools’ smart contract alerts.
Solana’s success is also reflected in the increased activity on its network. The TVL in Solana’s smart contracts has reached the highest level since November 2022, marking a 30% increase year-to-date in 2024. This growth outpaces that of Ethereum and BNB Chain, suggesting a stronger demand for Solana-based DApps. Notable DApps like the OpenSea NFT marketplace and the Jito staking solution have contributed to this surge, with significant volume increases reported by DappRadar.
Despite occasional network issues, such as a five-hour outage on February 6, Solana’s network metrics indicate no signs of peaking. The platform’s ability to handle substantial volumes and a large user base without significant deposits has been a key factor in its recent success. As the crypto market continues its bull run, Solana’s fundamentals, including its growing meme coin and NFT usage, position it for potential further gains in the near future.