- Declining Interest in Solana Spot ETF
- Impact of Other Blockchain Networks
- Solana's Development and Prospects
Solana (SOL) has been facing challenges in breaking through the $150 resistance level since August 12. Nonetheless, several network metrics indicate inherent strength within the Solana ecosystem.
Declining Interest in Solana Spot ETF
According to a report by Cointelegraph, one of the main reasons for the lack of enthusiasm among investors stems from the latest developments related to the potential launch of the Solana spot ETF in the US. On August 16, Cboe Global Markets removed form 19b-4 related to the Solana spot ETF from its website, raising concerns among market participants. Financial lawyer Scott Johnsson speculated that the US SEC has informally rejected the Solana ETF proposal. Eric Balchunas, a senior ETF analyst at Bloomberg, shared a similar view, noting that the chances of approval remain slim without significant changes in the SEC administration.
Impact of Other Blockchain Networks
The broader crypto market also presents challenges for Solana. Most notably, the average transaction fees on Ethereum have dropped to around $1, the lowest since July 2020, making Ethereum more appealing to users. Additionally, other blockchain networks are attracting attention, particularly with the launch of new meme coins, diverting demand away from SOL.
Solana's Development and Prospects
However, ongoing developments in Solana, such as the issuance of the PayPal USD (PYUSD) stablecoin on its network, which has reached $620 million since its launch in May 2024, should not be overlooked. Moreover, various projects continue to be developed on Solana, many of which have secured significant funding. For instance, the Solana hackathon program managed by Colosseum received $60 million to accelerate ecosystem growth, while the Decentralized Autonomous Wireless Network (DAWN) recently raised $18 million.
Despite positive developments, the growth of Solana's Total Value Locked (TVL) presents a mixed picture. As of August 22, Solana's dApps collectively held 34.9 million SOL, the highest level since October 2022 and a 13.7% increase from the previous month. However, this does not always translate to increased user activity.
Comments