In recent days, Solana's price has shown significant decline, raising questions among traders and analysts. This article examines factors affecting the price drop, network changes, and derivative market expectations.
Decrease in Solana Network Volumes
According to DefiLlama data, Solana's transaction volumes dropped by 30% over the past week, sparking concern over potential volatility. Despite this, Solana ranked second in weekly volumes with $20.9 billion. In comparison, Ethereum's volumes fell by 15%, while Sui declined by 8%.
Solana Meme Coins Price Dynamics
Amid a general decline in the cryptocurrency market, meme coins on Solana also suffered losses. Over the 30 days leading to December 27, Popcat fell by 42%, Dogwifhat by 40%, and BONK by 25%. A diminishing interest in meme coins may limit SOL demand.
Derivatives Market and Solana's Outlook
Despite SOL's 16% price drop over the same period, futures have shown resilience. The current 10% premium on monthly futures indicates a neutral-to-slightly-bullish market sentiment. Low funding rates signal neutral sentiment among retail traders.
The overall decline in Solana's network activity and reduced interest in meme coins suggest a moderately bearish outlook for SOL's short-term price. Nonetheless, derivatives data shows confidence among major players in the limited downside potential below $180.
