The cryptocurrency market is experiencing significant volatility with altcoins bearing the brunt of the losses, as Bitcoin’s price fluctuations prompt investors to sell off for profits. Despite the ETF approval potentially stabilizing Bitcoin, altcoins have seen double-digit declines, reflecting investor uncertainty.
Solana (SOL), one of the most prominent Ethereum competitors, has not been immune to the market downturn. Despite its popularity and high transaction volume, its price fell below $100 after previously surging from $20 to over $126, indicating a sell-off by investors seeking to capitalize on the gains.
In the first week of the year, Solana experienced a notable decline, dropping below $100, a stark contrast to its $115 peak on January 2nd. This occurred as Bitcoin wiped out $5,000 from its value, affecting all altcoins without exception.
The focus is likely to remain on Bitcoin in the coming weeks, with expectations of continued price weakness. However, should Bitcoin consolidate at higher levels, this trend could reverse. Investors often miss out on opportunities, hesitating after a fall and then fearing to miss lower entry points, leading to inaction.
Despite SOL’s price volatility, the Solana network’s activity is growing, with its daily transaction volume hitting a record high since October 2022. The network’s growth, particularly in the DeFi sector, and meme coins like ONK and WIF on Solana, have contributed to this surge, fueling optimism for SOL’s future.