Solana’s growing on-chain activity in the last few quarters suggests that there is a robust underlying market for SOL coins.

According to independent market analyst Hansolar, Solana (SOL) tickers down $113 appear ready for a bull run in the current cryptocurrency market boom, which is being driven by Bitcoin (BTC) tickers down $60,987.

SOL price could reach $600

If Bitcoin continues its long bull run over its record high of $69,000 set in November 2021, this fractal might recur in 2024. However, Hansolar contends that Solana might gain just as much this time if Bitcoin rises to its all-time high.

“Previously, when BTC truly broke out into ATHs, ETH took off. Then, as the high beta catch-up play, retail invests in SOL,” he said.

This fractal might recur in 2024 if Bitcoin continues to rise over its record high of $69,000 set in November 2021. That being said, Hansolar makes the case that Solana stands to gain just as much if Bitcoin resurrects its peak.

In the past, ETH surged in value when BTC truly experienced an ATH. Retail will then begin to invest in SOL as the high beta catch-up plays, he said.

“Currently, SOL is at around 50% from ATHs, similar to how ETH was around the 50% mark as BTC was nearing ATHs in the previous cycle.”

Nevertheless, Solana may set a long-term upside objective of $600 if Bitcoin continues to rally towards $150,000, a valuation that Fundstrat’s Head of Research Tom Lee projected would be necessary for ETF approval prospects. That is around 450% more than the SOL price at the moment.

Do Solana fundamentals support bullish SOL predictions?

In terms of network adoption, Solana has performed well on a fundamental level recently; its ecosystem’s total-value-locked (TVL) is at 20.51 million SOL, the highest level since January 2023.

The circulation supply of these tokens may decline as more assets are locked into DeFi platforms, thereby increasing demand relative to supply. The price increase of the locked tokens may be attributed to this scarcity effect.

The data resource portal Messari tracks Solana’s consistent quarter-over-quarter (QoQ) growth, which is in harmony with the company’s rising TVL.

Notably, during Q4/2023, the network’s average daily fee payers increased by 103%. Its average daily DEX (Decentralised Exchange) volume increased by 961% over that time, while its average daily NFT (Nonfungible Token) volume increased by 359%.

The airdrop of JUP, the native token of Jupiter DEX, in Q1/2024 also sparked on-chain activity on the Solana blockchain. Furthermore, its NFT volumes reached a peak close to $5 billion, showing a robust fundamental market for SOL tokens.

Solana technical analysis

Given that a bullish continuation pattern has formed on the daily chart, Solana’s main upside goal in the short future is $200.

The pattern, known as a bull pennant, appears when the price settles inside a symmetrical triangle structure following a significant upward surge. In the meantime, it settles when the price climbs to the height of the prior upswing and breaks above the upper trendline.

The price of SOL was attempting to break above the pennant’s top trendline as of February 28. In such a case, the cost might increase by 75% from the current levels to $200 in March.

On the other hand, a collapse below the lower trendline of the pennant runs the danger of completely invalidating the bullish setup. If that occurs, SOL’s price could fall by the same amount as the previous upward rise, or roughly 45% from the present price levels, towards $60.75.

The Conclusion

Solana’s ascent to a $600 valuation is not implausible. Solid technology, a robust ecosystem, and a growing interest from developers and users alike buoy it. However, potential investors need to parse the hype from reality and approach this and all investments in the crypto sector with cautious optimism.

While the growth potential is significant, the path is fraught with challenges that could quickly derail this supposedly destined trajectory. Therefore, taking a cautious view, considering financial goals, and employing diversified investment strategies can provide a safe passage through these tumultuous financial waters.