On Tuesday, Solana made an over 37% jump to set a new all-time high at $193. It is trading at $180.97 at the time of writing, registering a 25.1% gain in 24 hours, according to data from Coingecko. The coin has also outranked dogecoin to become the seventh-largest cryptocurrency in terms of market cap. Solana’s market valuation currently stands at over $52 billion.
Solana Outperforms Major Coins
Over the past month, Solana’s gains have increased by around 359%. This is a major gain compared to the other major altcoins such as Cardano, which has gained 84% in the past month. There is an even bigger gap when comparing the Solana gains with the 16% and 24% monthly gains in Bitcoin and Ethereum, respectively.
Despite the bullish sentiment over the past month, cryptocurrencies have still made some losses, but Solana has not succumbed to any bearish sentiment during this period. The coin has continued to make major gains despite the shifting strength of market support, indicating that buying pressure has played a central role in the current bull run.
Besides the growing prices, the Solana blockchain is also on a successful streak. The blockchain has gained growing adoption, and its popularity is increasing by the day. Solana works through a Proof of History (PoH) mechanism that offers high scalability and can execute up to 65,000 transactions per second.
The boom of DeFi has picked up in recent months, and the increasing demand for smart contracts has led to developers seeking scalable platforms. The low latency offered by Solana has now made it a major competitor to the Ethereum blockchain.
Solana-Backed Investments Rise
Data from last week showed that a record high of $13.2 million had been invested in Solana-backed investment products. CoinShares’ weekly report brought Solana’s total assets under management to around $44 million, a 193% gain in one week.
Solana’s price growth is expected to continue to the last quarter of 2021, and the coin could potentially hit a target of $500 if buyer support holds.
Since the market rebound commenced in August, investors have rallied up support for altcoins; hence, most have made larger gains than Bitcoin and Ethereum. Besides Solana, some altcoins have also hit new all-time highs, and those that have failed to do so have hit new monthly highs.
However, the trend has raised wariness among some market analysts. According to JPMorgan, the gains made by smaller coins could indicate that the market is overheating. A note published by JPMorgan’s research analyst last week stated that “Retail investors propelled “altcoins” in August making cryptocurrency markets look frothy again.” Hence, traders who are just joining the rally when prices are high need to be cautious.