According to Cointelegraph: Solana (SOL) surged 5.3% to trade above $167, following Bitcoin’s election-driven rally to $70,550. With traders setting a target closer to $200 for SOL, on-chain data and derivatives metrics indicate potential for continued growth in the near term. Solana’s recent gains highlight its resilience and correlation with Bitcoin’s performance, attracting traders looking to capitalize on the broader crypto rally surrounding the U.S. presidential election.
Solana Dominates DEX Volume, Outperforming Ethereum in Key Metrics
Solana’s strong performance in decentralized exchange (DEX) volumes underscores its user activity and transaction efficiency, factors crucial for long-term sustainability and network growth. Recent data shows Solana’s DEX activity reaching $11.86 billion in weekly volume, surpassing Ethereum’s layer-2 solutions. This edge reflects Solana’s capacity to attract users and projects, highlighting its competitive advantage in low-fee, high-speed transactions.
Staking Yields and Reduced Inflation Rate Strengthen Solana’s Appeal
Solana's native staking yield stands at 6.5%, with 66.9% of the circulating supply involved in network validation, outpacing Ethereum’s 28.6% staking ratio and BNB Chain’s 22.4%. This higher staking participation rate, combined with a reduced inflation rate of 5.4% (down from 5.7%), offers a favorable environment for SOL holders. In contrast, Ethereum’s staking setup is more consolidated, limiting immediate liquidity for its tokens.
Positive Funding Rates Indicate Balanced Demand for SOL Futures
On the derivatives front, demand for SOL futures is balanced, with a positive funding rate suggesting traders remain neutral to slightly bullish. Solana’s activity on perpetual futures markets, even with a recent price dip to $155, reflects optimism among traders and potential leverage buying support for a rally toward $200.
Election and Fed Rate Decision Could Influence Solana’s Trajectory
While Solana’s metrics are strong, external factors such as the U.S. presidential election results and Federal Reserve interest rate announcements could impact its trajectory. Market participants are cautious, as these events may introduce volatility, affecting both Bitcoin and Solana’s near-term performance.
With robust network metrics, high staking yields, and positive market sentiment, Solana is well-positioned for further gains. However, traders remain attentive to upcoming election outcomes and macroeconomic shifts that could influence the overall crypto market landscape.
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