The price of Solana’s SOL token has shown signs of renewed momentum with a breakout over the past week up nearly 10%. SOL now seems poised to take another run towards reclaiming its all-time highs around $260 later this year if bullish sentiment continues. But risks around network stability remain.
TLDR
- Solana price has started a fresh rally, gaining nearly 10% to break out above $108 resistance level
- SOL is now aiming to break through the next resistance at $114, which could open the path up to $118 and potential further gains
- Multiple analysts remain bullish on Solana’s prospects, predicting new all-time highs this year potentially over $250
- Key drivers for further SOL gains include a broadly bullish crypto market lifting prices, as well as Solana’s growth in areas like NFTs and DeFi
- However, risks remain such as potential further network outages, and SOL not yet breaking its lengthy price consolidation pattern
After consolidating for weeks around the $100 level, traders began scooping up SOL tokens last week, pushing prices up decisively through resistance around $108.
The surge comes amidst broad-based gains across cryptocurrencies, as Bitcoin led a market-wide rally backed by hundreds of millions flowing into crypto investment products.
The lift in crypto prices reminds some analysts of the frenzied bull market conditions last year when Solana set its record price of $260. One of the best performing layer-1 blockchains of 2021, Solana had gained an astounding 11,000% before crashing in the FTX implosion.
Now with SOL bouncing off recent lows to trade around $110, analysts are eyeing the all-time highs once again.
Raoul Pal, CEO of Real Vision, predicts Solana hitting between $750 and $1,000 this market cycle. Others see $250+ as achievable if momentum continues given rapid growth in Solana’s DeFi and NFT ecosystems.
Solana boasts one of the fastest and lowest cost networks in crypto, supporting over 1,800 decentralized apps and processing up to 65,000 transactions per second. Venture funding into Solana-based crypto projects also leads other layer-1s besides Ethereum.
And affectingly dubbed the “Sam coin” due to support from Sam Bankman-Fried, Solana seems to have moved past associations with the disgraced FTX founder.
Bouts of network instability remain Solana’s Achilles heel, however. A five-hour outage on February 6 caused some holders to dump tokens, although buyers quickly scooped them up. Developers continue working to bolster Solana’s infrastructure and prevent further interruptions.
While risks certainly exist, Solana seems ready to ride any wave of exuberance in crypto markets back up towards its former highs.
At around half its peak price, traders spy opportunity in SOL tokens before a potential supply shock kicks in from staking rewards diminishing.
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