Solana has shown promising signs of recovery in the industry. However, given the volatility of the market, users should exercise caution.
Summary
- Solana faced a challenging 2022, facing network issues and NFT departures, which led to a significant drop in the price of SOL.
- Promising indicators suggest potential improvements for Solana with improved scalability, a thriving DeFi and NFT ecosystem, and strong developer and investor support.
- Despite the positive signals, caution is advised due to the volatility in the market. Solana’s rebound remains uncertain, though it looks set to attract new users and developers.
Solana faces a tough year in 2022, facing network outages, links to the collapse of the FTX crypto exchange, and the departure of NFT collectibles such as degods and y00ts to other blockchains. As a result, SOL price dropped by more than 90% from its high of $260.06.
That said, there are some promising signs for optimism as the protocol seeks to re-establish itself as a leading player in the Layer 1 ecosystem. At the time of writing, Solana is trading at $20.70, but is there potential for further upside? This article explores the progress of blockchain and its potential for positive recovery.
Reasons for optimism around Solana
1. Enhanced Scalability and Reliability
Solana has made significant progress in improving its scalability and reliability. There has been a significant increase in transactions per second (TPS), and the network has enjoyed months free of significant outages.
Solana maintained 4K+ TPS over the last seven days. soulscan
2. Thriving DeFi and NFT Ecosystem
Solana remains a preferred platform for DeFi and NFT projects. Its vibrant community of developers and users keep it busy with activity.
3. Strong Developer and Investor Support
Solana is backed by a strong team of developers and investors, with the Solana Foundation dedicated to long-term project success.
Positive indicators in recent months
Solana has displayed some impressive metrics recently. According to DeFillama data, Solana’s TVL has recovered somewhat from a low of around $200 million at the end of 2022 to reach a figure of around $310 million. Sure, it’s far short of the November 2022 high of over $10 billion, but an increase of over 50% in just a few short months is no small feat.
Additionally, the number of daily active addresses on Solana has been encouraging, with over 240,000 active wallet addresses recorded in one week. The Layer1 blockchain, which is designed for mass adoption, saw over 350,000 unique wallet addresses interacting with it sometime in August.
Number of daily active addresses over the last seven days. soulscan
Road Ahead for Solana
These positive trends establish Solana as a major player in the blockchain ecosystem. Still, it is too early to determine whether the project will be able to fully recover from past setbacks. Market volatility and various influencing factors can affect the price of SOL.
Nonetheless, Solana looks set to attract new users and developers by re-establishing its influence in the DeFi and NFT sectors.
balancing optimism with caution
Overall, a mix of optimism and caution hangs over Solana’s future. Although its potential is clear, it needs to overcome challenges to truly flourish. Timing is the key to whether Solana can achieve a rebound in 2023 and beyond.
Source: www.bsc.news
