On August 10, SOL was trading at around $ 40. However, after just a month, the price jumped to nearly $ 200. SOL’s nearly 480% growth is a desirable figure for many other projects, but it’s not surprising. Here’s why.
SOL price table | Source: Tradingview
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The inflow of investment capital in altcoins has always acted as a growth catalyst. One of the catalysts that contributed to SOL’s upward momentum was investor funding led by Andreessen Horowitz and Polychain in June.
Solana raised $ 314 million that was used to develop the platform’s technology in the field of decentralized finance. However, this investment takes the form of buying SOL coins instead of traditional equity.
Thanks to the institution’s growing interest over the past few months, SOL outperforms both XRP and DOGE and is currently number 6 on the market capitalization rankings. In particular, Solana has signed new contracts with the Hacken Foundation and Gate.io, both of which contribute to the development of the platform.
FUD and the fall
As the larger market consolidated in the past 24 hours, the SOL price also fell about 5%.
The fall in prices could be the result of increased regulatory scrutiny over this asset class. Especially after UK Financial Conduct Authority (FCA) chairman Charles Randell claimed that celebrities who put retail investors at risk by luring them into altcoins could be scams.
The announcement was made as part of “Super Round 3 Lady” Kim Kardashian advertising a little known “small face value” cryptocurrency called Ethereum Max, which has over 200 million followers on Instagram.
However, the market generally always reacts immediately to FUD (Fear – Uncertainty – Doubt). Again this time, but is the drop in SOL price a sign of the market’s loss of confidence in this altcoin, especially given the allegations that the altcoin is a scam? Not really.
Solana it keeps growing
SOL is still more profitable and less risky than some of the top altcoins, even BTC, as the better ROI shows. Aside from SOL’s 24-hour ROI, all long- and short-term ROIs are bullish numbers at the time of writing.
Additionally, SOL’s market cap has filled a large gap between XRP and DOGE. In addition, the Sharpe ratio of SOL shows a steady upward trend and is currently at 13.07. In contrast, ADA is only 7.4 and ETH is 2.4.
BILLIONSharpe ratio (Green) and price SOL (gray) | The source: Messari
This means that the performance of SOL against a “risk free” asset is 12x better than that of ETH and 2x ADA over the same period. Another big reason the price could continue to rise is the announcement of the fourth hackathon, which is slated for October 8th.
In addition, according to tweets The Solana Foundation doubled the number of liquidity staking solutions on Solana in just 3 hours on September 8th – a boon to the network.
In addition, the Solana ecosystem continues to grow, especially with initiatives such as the introduction of Wormhole, the communication protocol between Solana and other DeFi initiatives. In short, SOL’s future looks very bright.
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According to AMBCrypto