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Solana (SOL) has posted a new all-time high (ATH) of $262, marking a historic recovery after three years of tumultuous price action. Notably, the token had once fallen as low as $8 at the peak of the FTX exchange collapse and the ensuing cryptocurrency bear market.
Solana achieves historic recovery and targets USDT change
Solana (SOL), the much-hyped “Ethereum killer,” is back in the spotlight. After dominating the 2020-21 cryptocurrency bull market, the digital asset saw its value fall following the spectacular collapse of FTX, led by Sam Bankman-Fried. However, SOL has staged an impressive comeback over the past two years.
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At the time of writing, SOL is the fourth largest cryptocurrency, with a reported market capitalization of over $123 billion. The market capitalization of the layer 1 blockchain is just $8 billion away from surpassing the stablecoin Tether (USDT) market capitalization of $130 billion.
In particular, SOL needs an additional 10% price appreciation to decisively increase the market capitalization of USDT and become the third largest digital asset by market capitalization. SOL will only be behind Bitcoin (BTC) and Ethereum (ETH) as the third largest cryptocurrency.
Given the token’s recent price trajectory, it won’t be surprising to see SOL surpassing the market cap of the leading stablecoin before the end of the year. In the last three weeks alone, the token has seen a remarkable 75% increase, rising from $148 on November 4 to $259 at the time of writing.
While the broader crypto market has gained momentum following the victory of pro-crypto US Republican presidential candidate Donald Trump, attributing SOL’s rise solely to this would be disingenuous.
Memecoin Frenzy, increased network activity and ETF potential helped SOL
SOL’s notable turnaround can be linked to several factors that have spurred greater adoption of the network. One of the most prominent contributors is the current memecoin frenzy, which has become a dominant narrative in the cryptocurrency market.
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Memecoins, particularly those based on the Solana blockchain, have become the main narrative of the cryptocurrency market over the last year. In October alone, the total market capitalization of Solana-based memecoins surpassed 10 billion dollars.
This memecoin craze has also resulted in intensified network activity for Solana. Between September and October, Solana saw a 42% month-on-month (MoM) increase in active addresses, amounting to approximately 123 million.
In addition to benefiting from the memecoin narrative, Solana has also seen increase Decentralized finance (DeFi) activity throughout the year. According to DefiLlama dataSolana hosts the world’s second-largest DeFi ecosystem, with a total value locked (TVL) of $9.265 billion.
Additionally, there are growing prospects for a Solana-based exchange-traded fund (ETF). A recent report indicates that the US Securities and Exchange Commission (SEC) is in active discussions with multiple asset managers about the possible launch of a new Solana spot ETF.
While SOL’s achievement of a new ATH is impressive, experts believe the token still has significant growth potential. At the time of writing, SOL is trading at $259, up 6.2% in the last 24 hours.
Featured image from Unsplash, charts from DefiLlama.com and Tradingview.com
