This week, Bitcoin has captured headlines with its remarkable performance. However, it’s not the only digital currency making waves. Solana stands out as the most impressive performer among the top five cryptocurrencies by market valuation, hitting a 22-month pinnacle this Thursday. This trend may indicate a growing inclination among investors to explore opportunities beyond the conventional choices.
Over the last day, Solana experienced a 16% increase, reaching a price point just over $131 per SOL on Gate.io, with a peak surpassing $134 in the early hours of Thursday. This marks the highest value for Solana since April 2022, showcasing a notable 26% surge over the previous week.
SOL price goes boom
Should Solana’s price ascend slightly to around $137, it will surpass a two-year high, a milestone last achieved in January 2022 based on CoinGecko’s data.
In contrast, Bitcoin has seen a modest decline of less than 1% in the last 24 hours, with its price hovering just below $62,400, despite a 21% increase over the week. Ethereum, on the other hand, has remained stable today at $3,450, marking a 16% rise this week. Expanding the scope to the top ten cryptocurrencies, Dogecoin emerges as the week’s standout, with a 53% increase to nearly $0.13.
The Solana ecosystem, particularly its meme coins, is also experiencing a surge, propelled by the overall market’s upward trajectory and Solana’s significant gains. The premier Solana meme coin, Bonk (BONK), has seen its price more than double in the past week, surging 104% to $0.000024, including a 48% increase in the last 24 hours.
Additionally, WIF, also known as Dogwifhat—a cryptocurrency inspired by a meme of a dog donning a hat—has soared 156% this week to $0.82, reaching an all-time high of over $0.88 early Thursday. Following these gains, BONK now boasts a market capitalization of nearly $1.6 billion, ranking it 64th by this measure, while WIF’s market cap has escalated to $823 million.
What’s Fueling Solana’s Momentum?
The trajectory of Bitcoin often influences the broader altcoin market, and with Bitcoin’s current rally, it’s no surprise that other cryptocurrencies are also thriving. Bitcoin’s price approached $64,000 on Wednesday, its highest since 2021, and was merely 12% shy of its all-time high of over $69,000 from November 2021.
Bitcoin’s resurgence, which could be influencing the wider market, can be attributed to the recent endorsement and integration of spot Bitcoin exchange-traded funds (ETFs) in the U.S. These ETFs offer investors Bitcoin exposure without the need to own the asset directly.
Billions of dollars are being invested into these ETFs, necessitating significant Bitcoin purchases by fund managers. Moreover, the anticipation surrounding the upcoming Bitcoin halving event, which reduces the mining reward by half and consequently slows the production of new Bitcoin, is likely fueling the current market optimism.
While Bitcoin’s events have undoubtedly benefited Solana, the Solana ecosystem itself has demonstrated remarkable growth and revitalization in recent months. After a dip to nearly $8 in December 2022 following the FTX fallout, Solana has made a formidable recovery, boasting a 468% increase over the past year.
SOL’s main competitor
Ethereum (ETH) has crossed a significant milestone, reaching a price of $3,600 per ETH. This surge marks the first occasion Ethereum has breached the $3,000 threshold since April 2022, showcasing a 3.5% increase from yesterday and an 8% uplift over the week.
An analyst with Kaiko, highlights a notable surge in market dynamics. “Open interest has soared to a multi-year peak at $7.7 billion, with funding rates experiencing their highest surge since the outset of January.” This trend indicates an influx of new investment driven by speculative interest and strategic hedging activities.
A pivotal update for the Ethereum network, known as “Dencun,” is scheduled for the upcoming month. This upgrade is designed to address existing scalability issues within the blockchain infrastructure.
The “Dencun” upgrade will introduce “proto-danksharding” to the Ethereum network. This feature is expected to enhance the network’s efficiency and reduce operational costs by leveraging layer 2 solutions. These solutions aggregate unconfirmed transactions on Ethereum, process them through an auxiliary network, and then relay the verification back to the main network.
Moreover, prestigious institutions from Wall Street are actively seeking regulatory approval for an Ethereum-based exchange-traded product (ETP). The approval of such a fund by the Securities and Exchange Commission (SEC) would pave the way for Ethereum to enter the portfolios of mainstream investors.Â
Industry giants including BlackRock, VanEck, and Grayscale are among those awaiting the SEC’s decision. In a show of support, Coinbase, a publicly traded cryptocurrency exchange, recently submitted a letter endorsing Grayscale’s application for an Ethereum ETF.
