Is Solana Dead?
Hello, friends!
Everyone’s wondering…
Is Solana dead? The short answer: NO.
The Long Answer?
Everyone’s focused on the fact that Solana dropped from $290 to $170 over the past month—without realizing that reaching $290 was a bit of an anomaly (driven by $TRUMP).
It wasn’t meant to last—the entire market has been in a downtrend for the past few months, and Solana is no exception.
When markets are in a downtrend, bad news hits differently (and Solana has been hit with some bad news).
Here’s how it all went down…
1/ A Tough Week for Solana
ICYMI: Over the past seven days, Solana has dropped by 12.3%!
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This is largely due to fear, uncertainty, and doubt (FUD) surrounding the launch of the Argentine token $LIBRA, alongside allegations that owners/employees of Jupiter (DEX) and Meteora (memecoin launchpad) were engaging in insider trading.
(None of these claims have been solidly proven or confirmed.)
2/ This Led to Fears That the “Memecoin Bubble” Has Burst
Memecoin trading typically accounts for 50-70% of Solana’s DEX trading volume, so this would be a problem. A big problem.
But since Monday, memecoins still make up 67% of Solana’s total DEX trading volume, which is roughly $3.2 billion.
For context: At the end of December, Solana’s total daily trading volume hit a low of $3.7 billion.
So, as bad as things may feel right now, the current volume is still above its two-month low.
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The problem is—the total trading volume has fallen off a cliff since January 19 (that big spike in the chart above ), which is scaring a lot of people.
But as we mentioned, that was an anomaly driven by the $TRUMP token launch.
And when that token was launched, both Solana and the broader crypto market were already in a larger downtrend…
3/ It’s Not Just Solana—It’s the Entire Market
This is the total market capitalization of the crypto market—it’s been stuck in a downtrend since December 17.
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This is Solana’s price—it’s been in a descending triangle since November 22 and only broke out due to the mania around the $TRUMP token launch.
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Here’s the math of it all…
Solana’s downtrend + overall market downtrend + recent bad news hitting Solana = -12.3% over the past week.
(It’s a lot less scary when you look at it from this angle.)
And if you zoom out?
You’ll see that this isn’t the “Death of Solana”—it’s an opportunity!
