Markets
Solana loses 3 billion in market capitalization in record time
1:30 p.m. ▪ 3 min reading ▪ by Luc Jose A.
The crypto market is experiencing unprecedented tremors and Solana, once considered a robust player, is taking a major hit. In one week, the fast and inexpensive blockchain lost $3 billion in market capitalization, revealing worrying vulnerabilities amid growing investor distrust.
The fall of Solana
The crypto market is going through a period of marked turbulence, and Solana is one of the main victims. Within a week, Solana (SOL) saw its value drop by 5%, thereby erasing billions of dollars from its market capitalization. On June 6, the price of SOL was still $170, but it plunged to $123.42 on June 24.
This drastic drop comes amid continued negative sentiment among investors across the crypto market.
The problems don’t end there for Solana. Blockchain, usually praised for its high throughput and low transaction fees, has recently faced network congestion issues. Additionally, intense competition from other blockchain platforms has only exacerbated the situation.
The influence of Memecoins and personalities
The fall of Solana cannot be understood without examining the impact of memecoins and influential market figures. Recent memecoin transactions have increased Solana’s volatility, drawing attention to its structural weaknesses.
In May, more than 500,000 memecoins were launched, fueling a craze that only complicated the situation. Among the influential actors, Andrew Tate stood out with a spectacular action: it burned $38 million worth of Solana-based memecoins, eliminating 58% of their supply and causing a 130% increase in their price. Even if he claims not to have benefited personally from this action, his intervention undeniably disrupted the market.
This context of instability is not unique to Solana. Other major cryptocurrencies, such as Ethereum (ETH), Cardano (ADA), and BNB, also suffered similar losses, while Bitcoin fell to $61,000. Popular memecoins Dogecoin (DOGE) and Shiba Inu (SHIB) saw a decline of around 5%. It is now up to Solana to prove her resilience to regain the trust of crypto investors!
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Luc José A.
A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I took the commitment to raise awareness and inform the general public about this constantly evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to relay the latest technological innovations and to put into perspective the economic and societal issues of this ongoing revolution.
DISCLAIMER
The views, thoughts and opinions expressed in this article belong solely to the author and should not be considered investment advice. Do your own research before making any investment decisions.