Solana Market Update

Solana gained nearly 6% on Friday, rallying alongside Bitcoin, as the largest cryptocurrency regains $80,000 as support. However, the total value of assets locked in the Solana chain is down $5.26 billion from its peak, a nearly 50% drop. TVL represents demand and relevance for a chain, meaning Solana is negatively affected by the shifting market dynamics.

Table of Contents

• State of Solana
• Solana Meme Coin Market Analysis
• Market Movers and Solana Catalysts
• SOL On-Chain Analysis
• Solana Price Forecast

State of Solana

The total value of assets locked (TVL) is a key metric in DeFi to track investor confidence and demand among crypto traders. TVL tracked on DeFiLlama shows that Solana is slowly losing relevance in the ongoing crypto market cycle.

SOL’s TVL has dropped from a peak of $12.191 billion to $6.939 billion, marking a nearly 50% decline. The decline is largely attributed to the crash of meme coins on the SOL chain.

Solana TVL Chart

In the past month, the top 10 protocols on the Solana blockchain have lost up to 40% in TVL. Major catalysts include Bitcoin’s flash crash, controversies surrounding MELANIA and LIBRA meme coins, and risk-averse behavior among traders due to U.S. macroeconomic developments.

Top 10 Chains on Solana

Solana Meme Coin Market Analysis

On CoinGecko, Solana meme tokens are showing slight recovery. The market cap of all tokens in this category is at $8.949 billion. However, two among the top five Solana-based memes, TRUMP and Bonk (BONK), posted negative returns in the last 24 hours.

The remaining three, Dogwifhat (WIF), Pudgy Penguins (PENGU), and ai16z (AI16Z), have begun to recover. Overall, more than half of Solana’s meme coins experienced double-digit corrections in the last week.

Solana-Based Meme Coins

Market Movers and Solana Catalysts

The CME Group’s announcement of upcoming Solana futures is bullish for the Ethereum competitor. This follows MetaMask’s plans to support Solana by May 2025, allowing users to buy, sell, swap, and interact with various dApps across the SOL ecosystem.

Bitcoin’s recovery and its re-establishment of the $80,000 support level have positively affected Solana’s performance. The two assets enjoy a correlation of 0.83 over three months, meaning Bitcoin’s price movements directly influence Solana’s trend.

SOL On-Chain Analysis

Solana’s on-chain metrics indicate potential recovery in the coming weeks. Despite several days of negative funding rate on Binance, it saw a positive funding rate, suggesting bullish sentiment among derivatives traders.

Open interest values have risen to over $2.26 billion. SOL’s price is also up nearly 6% as it moves away from a downward trend.

Solana On-Chain Analysis

Solana Price Forecast

Solana may break its downward trend if a daily candlestick closes within the resistance zone of $147.09 to $166.42, identified as a fair value gap in the market. A close above $180 could lead to a retest of $200—a critical resistance level.

Technical indicators support this bullish thesis, with RSI reading 32 and MACD indicating waning negative momentum.

SOL/USDT Daily Price Chart

Ryan Lee, Chief Analyst at Bitget Research, shared insights on Solana’s price action, linking it to external factors such as trade tensions and liquidity strains affecting investor confidence. He noted that the next 30 days are pivotal for market clarity, heavily influenced by Bitcoin’s price trend and macroeconomic conditions.

> Note: This article does not constitute investment advice and is intended for educational purposes only.