SBF’s Major Influence on Solana
Solana is recognized as one of the most high-performing blockchains globally, designed to keep transaction fees low for applications serving billions of users. The average transaction fee (TPS) is around $0.00025, with Solana capable of processing up to 50,000 transactions per second. Currently, they are handling about 1,000 transactions per second, with a total of 114,740,735,051 Solana transactions completed.
While Solana shares similarities with blockchain projects like Ethereum, Zilliqa, and Cardano, it sets itself apart by implementing a unique combination of architectural design decisions aimed at enhancing flexibility. Anatoly Yakovenko, the Ukrainian-born co-founder based in California, has overseen development efforts at Qualcomm for operating systems and compression at Dropbox, before founding Solana. He holds two patents related to high-performance operating system protocols, which distinguishes him from other blockchain founders.
Solana enables developers to build and launch customizable applications in various programming languages, with the SOL cryptocurrency playing a pivotal role in sustaining and running the Solana ecosystem.
After the bankruptcy of FTX and its founder Sam Bankman-Fried, many cryptocurrencies, particularly Solana, faced selling pressure. This resulted in FTX’s liquidity gap of over $8 billion, leading to Sam stepping down as CEO and filing for Chapter 11 protection across FTX.com, FTX US, Alameda Research, and more than 130 affiliated entities.
Although the cryptocurrency market has shown some recovery in recent days, the question remains whether the worst for SOL is over. Given that Sam Bankman-Fried was a major investor and advocate for Solana, the collapse of FTX had a disproportionate impact on Solana compared to other cryptocurrencies. It is estimated that Sam Bankman-Fried owned roughly 10% of all Solana coins as a result of early investments and direct deals with Solana to purchase a large amount.
In the short-term, Solana will likely continue to experience the negative effects of this situation. However, Solana still has a substantial user base, and it is expected to recover from this setback. FTX’s assets in Solana will likely be sold at a discount to the highest bidder, but the timing of this sale is uncertain—ranging from weeks to months or even years. Given Sam’s significant political ties, with him being the second-largest donor to the Democratic Party and Joe Biden’s campaign, some analysts even question whether he will face legal consequences in the U.S.
As cryptocurrency influencer Ben Armstrong stated:
“Sam Bankman Fried was certainly a huge investor and proponent of Solana, but he was not Solana. Solana particularly enjoyed many investments by venture capital funds during the last market cycle, and without that money artificially pumping it, Solana will have to return to its fundamental utility to regain excitement. If the team behind Solana focuses on this, it will survive, but it will be a long journey back to legitimacy.”
– Sam Armstrong aka Bitboy
Additionally, the easing of inflation in the United States is a positive development for riskier assets like stocks and cryptocurrencies. According to Bank of America, the U.S. Federal Reserve could ease its monetary policy, potentially helping to stimulate recovery in the cryptocurrency market.
Solana (SOL) Technische analyse
Solana (SOL) has dropped from $38.78 to $12.08 since November 5, 2022, with the current price standing at $13.75. Solana might struggle to maintain a price above $12 in the coming days. A break below this threshold could signal that the price may further decline to around $10.
As seen in the chart below, Solana (SOL) has been in a downtrend since November 2021. While the price remains below $50, it is still within the SELL-ZONE.
Key Support and Resistance Levels for Solana (SOL)
The chart below outlines important support and resistance levels that can assist traders in predicting price movements. Solana (SOL) is under continued pressure, but if it manages to break above $30, the next potential resistance target could be $40, or even $50. The current support level is at $12, and if this level is broken, it would signal a “SELL” with a potential drop to $10. If the price falls below $10, an important psychological support level, the next target could be around $8.
Factors Supporting an Increase in Solana’s (SOL) Price
The cryptocurrency market has been under significant pressure recently, particularly with the bankruptcy of FTX. Although the risk of further decline for Solana is still present, if the price advances beyond $30, the next targets could be $40 or even $50.
What Indicates Further Decline for Solana (SOL)
Solana (SOL) has experienced a decline of more than 60% since November 5, dropping from $38.78 to a low of $12.08. Due to its association with Alameda Research, Sam Bankman-Fried’s trading firm, Solana suffered a substantial crash. Although the cryptocurrency has seen a slight recovery in recent days, the key question remains: Is the worst over for SOL? The current price stands at $13.75, nearly 90% off its April 2022 highs, and over 93% lower than the previous year. Solana may struggle to maintain a price above $12, and a break below this level could indicate a further decline toward $10.
Meningen en analyses van deskundigen
Sam Bankman-Fried, a major investor and supporter of Solana, played a significant role in its rise. However, the collapse of FTX has had a greater impact on Solana than many other cryptocurrencies. While the situation will continue to affect Solana negatively in the short term, the platform has a strong user base and is expected to recover. At the Solana Breakpoint event in Lisbon in 2022, it was revealed that Solana’s developer community had grown by over 1000% from 2021 to 2022. This shows that developers continue to support the platform, though it remains uncertain when Solana will regain investor confidence. It could take days, weeks, months, or even years.
Disclaimer: Crypto markets are extremely volatile and not suitable for everyone. Never speculate with money you cannot afford to lose. The information provided on this site is for educational purposes only and should not be considered investment or financial advice.
