The Solana network has significantly outpaced the Ethereum network in the recent past on web3 activities fueled by its meme coin space growth.
In the past seven months, Solana SOL $157.3 24h volatility: 3.9% Market cap: $83.04 B Vol. 24h: $4.85 B price established a robust support level above $128, which formed the grounds for the ongoing bullish breakout. The large-cap altcoin, with a fully diluted valuation of about $98 billion and a daily average traded volume of around $4.7 billion, surged over 8 percent in the past two weeks to trade above a crucial resistance level of around $160 for the first time since late July.
Although Solana’s price is not fully out of the woods, the chances of a bullish breakout towards the all-time high have significantly increased. From a technical analysis standpoint, Solana price must consistently close above the July 2024 peak of about $190 to secure a rally toward $250 in the subsequent weeks.
Nevertheless, the last call for Solana’s bullish breakout will heavily be determined by Bitcoin BTC $108 614 24h volatility: 3.4% Market cap: $2.16 T Vol. 24h: $30.31 B and Ethereum ETH $2 654 24h volatility: 5.1% Market cap: $320.23 B Vol. 24h: $21.46 B price action in the near term. With the altcoin market showing a positive correlation with Bitcoin, which has in return shown a positive correlation with Gold, a bullish breakout will likely occur ahead.
Fundamentally, the crypto space is awaiting another Fed rate cut amid the upcoming US 2024 general election.
Solana Threatens Ethereum Web3 Dominance
The Solana Network has grown to a vibrant Web3 ecosystem in the past year after shrugging off the impact of the FTX and Alameda Research implosion. According to the latest market data, the Solana network has a total value locked of about $6.41 billion, the highest since January 2022.
The confidence in the Solana ecosystem has significantly grown in the last year, with its stablecoin market cap having scaled to over $3.5 billion. Remarkably, the active addresses in the past 24 hours on the Solana network were about 7.62 million, while the Ethereum network had a total of 397k in daily active addresses.
The notable spike in Solana’s on-chain activity is largely attributed to its meme coin ecosystem, which has scaled to over $11 billion in market cap and a daily average traded volume of around $2.5 billion.
Consequently, Solana’s DEX volume surpassed $2B in daily volume for the third day in a row, hence outpacing Ethereum and all other top-rated chains. Meanwhile, Solana’s token issuer Pump.fun is almost reaching 1 million SOL in lifetime collected fees, having facilitated the launch of over 2.5 million meme coins.
On the other hand, the Ethereum network is still struggling with low demand from institutional investors, as shown by the notable cash outflows from the US spot Ether ETFs.
Despite having over a dozen scaling solutions, Ethereum’s dominance in the Web3 space is heavily threatened by Solana and other emerging chains such as Toncoin TON $3.03 24h volatility: 2.2% Market cap: $7.47 B Vol. 24h: $170.13 M .
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