Will Solana hit ATHs?

November marks two years of bear market.

Summary

• Introduction

• Daily Active Addresses

• DEX Volume

• Narratives

  • Artificial Intelligence

  • Gaming

  • DePIN

  • DEX Trading

  • NFTs & Compressed NFTs

  • NFT DeFi

• Conclusion

Introduction

November marks two years of bear market. It has not been an easy two years for crypto in general, particularly for Solana and its community who suffered from constant FUD, misinformation and the FTX collapse. So far, 2023 has been a year of recovery, rebuilding and investment.

Although the future looks good, will it translate into a $SOL all-time-high in the next bull cycle? Let’s take a look.

Is FTX still a cloud upon Solana’s growth?

We’re almost a year into the collapse of the second-biggest crypto exchange at the time, and although many Crypto community members, influencers and analysts discard Solana due to what happened to FTX, the Solana ecosystem does not share the same opinion. The ecosystem continues to move forward with more than 1,000 developers at the forefront of blockchain innovation on all fronts, from Exchanges and trading to decentralised physical infrastructure networks.

Daily Active Addresses

Solana has shown resilience over the first 6 months of 2023, averaging 300K daily active addresses. Solana is on par with Ethereum and Polygon’s active addresses, and slightly below Bitcoin’s average numbers. It is important to note that the FTX crash happened at the end of 2022, and data suggests that the Solana user base did not decrease as it was expected.

DEX Volume

DEX Volume on Solana is at the same levels Year-over-Year, averaging over $1B monthly volume since January 2023. Apart from December, Monthly volume did not slow down since the FTX colapse.

Narratives

Artificial Intelligence

The Solana Foundation is actively paving the way for Artificial Intelligence (AI) advancements. Notably, Solana Labs has introduced a ChatGPT Plugin that enhances user interaction by enabling functions such as checking wallet balances, token transfers, and NFT purchases.

To further promote the fusion of blockchain development on Solana with AI, the Solana Foundation has established an AI Grants Program with a $10 million fund. This initiative aims to encourage experimentation in this intersection, and within the first week, the program received the response of over 50 applications. Additionally, the foundation has created a three-month accelerator program tailored for university students, emphasizing the exploration and experimentation of blockchain and AI technologies.

Gaming

Solana has emerged as a leading blockchain platform for gaming, thanks to its advanced technology and robust infrastructure. Its scalability is a standout feature, enabling the processing of numerous transactions per second with minimal delay. Leveraging the Proof of History (PoH) and Proof of Stake (PoS) consensus mechanisms, Solana ensures swift and seamless gameplay experiences by handling thousands of transactions simultaneously.

Another notable advantage of Solana is its low transaction fees, making it highly cost-effective for in-game transactions such as item trading and asset transfers. This affordability promotes active player engagement and stimulates economic activities within the gaming ecosystem.

DePIN

Many analysts and thinkers argue that DePIN will play a vital role in the future of Blockchain Technology. Due to its infrastructural and technical advantages, several DePIN projects are building on top of the Solana network.

Hivemapper, Helium, Render and Teleport are some of the projects building decentralised physical infrastructure networks.

DePIN can be applied to several infrastructure systems, such as energy grids, transportation networks, and water systems. By decentralising the infrastructure, these networks can increase resilience, reduce the risk of catastrophic failures, and improve efficiency by reducing the need for long-distance transportation of resources.

DEX Trading

One of the main narratives for Solana has been the decentralised trading, due to Solana’s low transaction fees and speed. Platforms like Orca provide users with a user-friendly place for swapping crypto and providing liquidity to the ecosystem. The perpetual trading narrative has been growing on Solana with the growth of Drift Protocol and Zeta Markets. The ecosystem is now waiting for the launch of CUBE, a trading platform which claims a 40x improvement in performance when compared to the current market.

NFT DeFi

NFT DeFi is one of the newest narratives to accelerate on Solana. Innovation in the NFT space has led to a new class of investment: NFT Lending and Borrowing. Platforms like Sharky, Citrus, Frakt and Rain are leading the race and fighting for marketshare. The NFT Lending space has grown so much that it is drawing liquidity from NFT Trading as many users prefer lending Solana or borrowing against their NFTs, than trading.

Conclusion

Will Solana hit All-Time-Highs ever again? We don’t know, however, in the midst of an aggressive bear market, Solana continues to push innovation across the crypto ecosystem and has a vast user base. Many analysts argue that fundamentals precede price which may be what’s happening to Solana.