New ATH for Solana (SOL) at $71.83: risk of correction

Like other cryptocurrencies, Solana’s SOL price is breaking records at +80% in 7 days. At $71.83, the token sets a new ATH.

Several of the major altcoins have returned to double-digit growth rates, setting new ATHs or approaching those prior to last May’s crypto crash. Solana’s native token is making its mark among these crypto-assets.

SOL has largely recovered from its May losses. And the growth continues for the SOL price, which has been steadily rising since mid-July. The token is recording a new all-time high every day.

Solana ecosystem grows and interconnects

Since the end of last week, the SOL curve has even been explosive. On August 13, the cryptocurrency was trading below $45. Four days later, it is evolving above $70.

Over 7 days, Solana is in fact recording more than 80% growth. And this trend continues with +13% over 24 hours and a transaction volume up 50% compared to yesterday. This surge is not without fear of a correction, however.

Nevertheless, there are several factors that explain the rise in the SOL price. The Solana blockchain ecosystem is currently experiencing rapid development. This includes the creation of a DEX on Solana, Mango Markets, funded to the tune of $70 million via crowdfunding.

Mango’s purpose is to provide a platform for cash markets, loans and perpetual futures. For its liquidity, DEX draws from native pools and from Serum.

Profit taking possible on the SOL

Solana’s integrated exchange has the backing of crypto figure FTX, billionaire Sam Bankman-Fried’s DEX. With Mango, Solana thus has a serious competitor to Ethereum exchanges like Uniswap.

See also  Cardano's Alonzo hard fork launched: ADA not budging

To fuel its growth and its uses, Solana can also count on the Wormhole protocol. This allows to build bridges between the blockchain and reference projects of the DeFi, including Terra, but also with Ethereum and Binance Smart Chain.

CoinTelegraph however identifies several risk points. For example, Solana’s latest bull run came during a downturn in major cryptocurrencies. However, ETH and BTC are currently entering a consolidation phase.

Our confreres thus believe that Solana could face a risk of overvaluation, and therefore a correction. Evidence? On Monday, the daily RSI of the SOL/USD pair reached 84, increasing the risk of profit taking.