 ▲ Solana (SOL) |
Solana's SOL coin, a strong competitor to Ethereum (ETH), has lost about 8% of its value over the past week.
SOL Coin, the 5th largest cryptocurrency by market capitalization, is trading at $145.50 as of 9:56 am on the 16th (Korean time), down 7.97% from a week ago based on CoinGecko.
Bitcoin (BTC), the leading cryptocurrency, is trading at $66,186, down 4.42%, and Ethereum, the second-largest coin by market cap, is trading at $3,559, down 3.25%.
Cointelegraph diagnosed, “The price of Solana (SOL) fell 3.45% over the past 24 hours, mainly due to poor performance compared to Ethereum and stagnant inflows into the Solana ecosystem.”
“While the broader cryptocurrency market correction had an impact on SOL, SOL suffered a bigger decline as the likelihood of regulatory approval for an ETH spot exchange-traded fund (ETF) in the U.S. increased. This led to a significant decline in the SOL/ETH pair,” the media said. “While Solana’s market share decreased, Ethereum’s market share and investment inflow increased significantly.”
According to Cointelegraph, since May 20, SOL's cryptocurrency market share has fallen from 3.30% to 2.82%, while ETH's cryptocurrency market share has risen from 15.78% to 18.04%.
Additionally, according to CoinShares' weekly report, Ethereum investment products attracted $68.9 million in the week ending June 8, significantly higher than Solana's $700,000 inflows during the same period.
A decrease in Solana network usage is also considered a cause of the SOL price decline.
The media said, “The decline in the price of SOL is due to the stagnant Total Lockup Deposits (TVL) indicator of Solana’s network usage and the decrease in SOL holdings of major Solana-based projects such as JITO. In addition, Solana’s decentralized exchange (DEX) “As participation has decreased, selling pressure has increased on SOL, contributing to the price decline.” “This indicates that there is a possibility of further decline,” he explained.
Meanwhile, according to Daily Issues, CredibleCrypto, an anonymous cryptocurrency analyst with about 400,000
However, he added, "The $140 range is the area where a rebound is most likely to occur. Solana is in a position to rebound even temporarily as Bitcoin reaches the bottom of the range."
