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SOL is now 5th largest cryptocurrency after a 900% annual rally

By Solomon Victor

Solana’s native token, SOL, has soared 73% in the last month to reach a 20-month high. This puts it close enough to rival Binance Coin (BNB) for fourth place among global cryptocurrencies. SOL is now the 5th largest cryptocurrency after a 900% annual rally.

The Solana Surge

Solana, a crypto computing platform prioritizing both speed and decentralization, has implemented unique mechanisms such as “proof of history.” Along with the recent increase in SOL’s market capitalization have come sharp increases in the 24-hour trading volume. Following this surge, SOL’s market capitalization of $44.4 billion is approaching BNB, the fourth-largest coin which is currently valued at $49.1 billion per CoinGecko statistics, as of writing time.

Analysts point to several factors for SOL’s rally, including the rise of Bonk (BONK), a dog-themed memecoin issued on Solana. The success of BONK led more people to take an interest in other Solana-based meme coins, and helped fuel coin growth on the layer-1 blockchain.

The sale of Solana Saga smartphones proved to be an important factor too. Those who purchased the phones would receive a 30-million-BONK coin airdrop, generating excitement about the Solana ecosystem. The phone has 512GB of RAM, dual back cameras, six-and-a-half inch OLED display, a fingerprint scanner, and runs on the Android operating system. It integrates mobile technology with the capabilities of Solana’s blockchain, bringing a new functionality to the world of crypto.

On December 21, the Solana team conducted its “Solana Solstice” celebration, recapping key events of the year. These events include the BONK hype, the launch of the Saga mobile device, AI integration, and institutional partnerships.

The company describes Saga as “Solana’s next step in further improving its interaction with the mobile community and the wide adoption of Web3 on mobile devices.” 

Solana, alongside Stacks (STX) and NEAR, has become a top-trending cryptocurrency, fueled by conversations on social media platforms. However, caution is advised to investors as the fear of missing out (FOMO) may impact prices, according to insights from Santiment.

The Remarkable Turnaround

From a price below $10 to now about $104, Solana has experienced a remarkable turnaround, recording a surge of over 900% since the market’s bottom in December 2022. During this period, SOL temporarily fell to the 16th position by market cap but has now firmly secured its place among the top cryptocurrencies.

Google Trends data reflects this ascent, with a notable increase in searches for Solana, nearly rivaling those for Ethereum in the United States.

Despite the bullish trend, technical analysts have raised concerns about a potential major crash, highlighting a lack of underlying momentum. This suggests a looming selloff around the corner.

Read also: What are the top 5 blockchain projects you should know?

Debates about Solana Mobile

The Saga smartphone, touted as a game-changer in the mobile industry, faced contrasting opinions. While some, like tech YouTuber Marques Brownlee, labeled it the “worst smartphone of 2023,” others praised its integration of blockchain technology to enhance the experience for cryptocurrency users and developers. Despite varying opinions on its performance, the Saga smartphone has undeniably contributed to the zeal surrounding Solana.

In a disclosure on December 22, Solana Mobile confronted inventory hurdles as it grappled with an unprecedented surge in demand for its Saga product, leading to swift sellouts across the United States and the European Union. Despite the fervent interest, the company found itself constrained by a limited inventory, having produced a mere 20,000 devices globally.

Compounding matters, the tech giant faced fulfillment challenges as a third-party distributor encountered inventory management issues, prompting order cancellations and necessitating refunds for affected customers. 

Read also: Solana’s 183% surge in 30 days: Dynamics and Prospects

Increase in Crypto Market Participants 

The broader crypto market is also showing some signs of excitement, as analysts are predicting that there will be a massive influx in users by 2024 which will bring up the size of the global crypto community to around one billion. In a December 1 report, Bitfinex analysts mentioned that the number of worldwide customers now stands at 575 million, much higher than the figure of 432 million at the beginning of this year

Envisioning a robust trajectory, the analysts anticipate the user base to potentially skyrocket to a range between 850 and 950 million, contingent upon the continuation of bullish market conditions. This optimistic projection underscores the growing global interest in and acceptance of cryptocurrencies, despite the tumultuous landscape experienced in the preceding year

Read more: Solana and Its Ecosystem: Blockchain, Token, and Projects

Credit: Solomon Victor is a Technical Analyst who is also knowledgeable about various aspects of blockchain and cryptocurrency.