Solana’s SOL price plummeted by nearly 30% on Sunday to $210, marking the largest decline since its highest level this year. The sharp drop came despite the network achieving a record $258 billion in volume in January, a milestone that would put it over the $1 trillion mark if the trend continues.
The sell-off affected most cryptocurrencies, with Bitcoin (BTC) briefly dipping below $100,000 and the total market cap of all coins crashing by almost 4% to $3.4 trillion. The Solana ecosystem’s protocols handled a record high of $969 billion in January, driven by various meme coin launches including Official Trump, Melania, and Vine.
However, the number of active Solana wallets dropped to 3.6 million, down from 6.5 million on Jan. 19, and the market cap of all Solana meme coins has slipped to $14 billion. The daily price chart shows that SOL has crashed in the past few days, retreating from its year-to-date high of $295.4.
Despite the downturn, analysts like Knox Ridley of I/O Fund believe Solana’s unique “proof of history” protocol will make it a market leader. Ridley says Solana’s PoH enables faster and more efficient transactions without second layers, which could put it ahead of Ethereum’s protocol in terms of throughput.
The approval of a Solana ETF is also seen as a possible catalyst for the coin’s price recovery. Multiple asset managers have refiled applications with Cboe BZX, including Bitwise, VanEck, 21Shares, and Canary Capital, which could lead to increased demand for crypto investment products.
Source: https://crypto.news/solana-selloff-continues-as-1-trillion-milestone-nears