Solana (SOL) has recently achieved a major milestone by registering the highest number of daily active addresses in its history. This has come at a time when the cryptocurrency has also been seeing high volatility, leading to speculation about what can drive it and perhaps influence the market with it.
Solana breaks a new record
On September 10, 2024, Solana surpassed 5 million daily active addresses, up from 1.05 million at the beginning of the year. This shows that the Solana ecosystem is growing, especially DeFi and nfts, which are gaining traction.
Source: Artemis.XYZ
An increase in active addresses generally denotes that more users are interacting with the network, which, in turn, could be a positive indication towards the long-term viability and adoption of the platform.
The increase in the number of daily active addresses is impressive, considering the broader context of the recent fluctuating cryptocurrency market.
The surge in users is postulated to be partly due to increasing action in DeFi projects and nft marketplaces on the Solana blockchain and, in essence, a resurgence of fortunes in cryptocurrencies in general after a prolonged period of relative stagnation.
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SOL market cap currently at $61.5 billion. Chart: TradingView.com
Price volatility and market reaction
Despite record user activity, investors remain cautious due to SOL’s unpredictable fluctuations. SUN It fell by 2.4% in a single day to $131 on September 11, 2024. Due to the current price volatility, traders are unsure whether the increase in daily active addresses would prevent the coin’s price from stagnating.
This volatility has divided market analysts on what this could mean for the future of the cryptocurrency. For some, the increase in user activity is a bullish indicator that could eventually drive an on-chain price recovery, while others think new investors might stay away given the current price fluctuations.
Further complicating the market dynamics is the fact that “whales,” or large holders, have been accumulating a significant amount of SOL, with one whale reportedly purchasing 61,000 coins.
These types of large acquisitions have the ability to dramatically change investor sentiment and prices. Whales like this one must be under constant observation by market sentinels.
Related reading: Cryptocurrencies in crisis: SEC fines $4.68 billion in aggressive regulatory effort
Future prospects for Solana
This latest surge in daily active addresses has sparked much discussion about the future of Solana in the cutthroat world of cryptocurrencies.
Many in the industry believe that blockchain will be a force to be reckoned with in the world for DeFi and nft uses once user adoption continues to increase.
Featured image from SciTechDaily, chart from TradingView
