Recent market dynamics have seen Solana struggling to break above the $200 mark. A notable bearish factor among these market fundamentals is the recent reports of the estate of bankrupt cryptocurrency exchange FTX selling its $7.65 billion worth of Solana at a 68% discount to its current market price.
However, on-chain data indicates SOL is still going on strong, particularly in the stablecoin sector. Stablecoin transfers on the Solana chain reveal the blockchain steadily processing more transactions than Ethereum every day, registering $411.2 billion more in trading volume in the past week.
On-Chain Data Highlights Solana’s Growing Stablecoin Usage
Data from Artemis, a crypto on-chain analytics platform, has highlighted the growing usage of stablecoins on Solana. According to on-chain data, daily stablecoin trading volume on the blockchain has outpaced that of Ethereum for almost the entirety of March, particularly starting on March 9. The difference in trading volume was further aggravated in the past week, as noted by Artemis in a social media post.
For example, Solana registered $97.5 billion in stablecoin trading volume yesterday March 30, compared to a $9.3 billion volume on the Ethereum blockchain. The highest difference came on March 28, with the altcoin registering $112.9 billion in trading volume, $95.3 billion more than Ethereum’s $17.6 billion. Consequently, Solana now contributes over 80% of the stablecoin market trading volume.
According to Artemis, most of the volume can be attributed to MEV bots and Phoenix, a decentralized crypto exchange. MEV (maximum extractable value) bots are programmable software built to scan blockchain networks for transactions that have the potential to generate profits and then automatically carry out those transactions. These bots have been particularly active on the Solana blockchain, constantly scanning for arbitrage opportunities for profit.
Total crypto market cap is currently at $2.582 trillion. Chart: TradingView
SOL To 200?
The Solana ecosystem is expanding quickly, as evidenced by price surges and on-chain metrics. SOL, Solana’s native cryptocurrency, witnessed considerable growth in the past seven days to reverse last week’s downtrend.
At the time of writing, SOL is trading at $195, up by 13% in the past seven days and reaching as high as $198. The price of Solana had already touched $208 on March 18. However, the bullish momentum wasn’t enough to keep the price appreciation going, as it dropped to as low as $167 on March 20.
Fundamentals point to a roadblock before reaching the $200 mark again. The roadblock is in tune of 41 million SOL tokens about to hit the market from the estate of FTX. Such a selloff could increase the selling pressure, leading to a price reversal. Trading activity, on the other hand, indicates that there is a greater possibility of price appreciation and that Solana is on the route to reaching $200 and beyond.
Featured image from Pexels, chart from TradingView
