Markets
Solana loses 3 billion in market capitalization in record time
1.30pm ▪ 3 minute read ▪ by Luc Jose A.
The cryptocurrency market is experiencing an unprecedented shakeup and Solana, once considered a robust player, is taking a hit. In a week, the fast and cheap blockchain lost $3 billion in market capitalization, revealing worrying vulnerabilities amid growing investor mistrust.
The fall of Solana
The cryptocurrency market is going through a period of marked turbulence, and Solana is one of the main victims. In the space of a week, Solana (SOL) saw its value drop by 5%, wiping billions of dollars off its market capitalization. On June 6, the price of SOL was still $170, but on June 24, it plummeted to $123.42.
This drastic drop comes amid persistent negative sentiment among investors across the entire cryptocurrency market.
Solana’s problems don’t end here. Blockchain, usually praised for its high productivity and low transaction fees, has recently faced network congestion issues. Furthermore, intense competition from other blockchain platforms has only exacerbated the situation.
The influence of Memecoins and personalities
Solana’s downfall cannot be understood without examining the impact of memecoins and influential market figures. Recent memecoin transactions have heightened Solana’s volatility, drawing attention to its structural weaknesses.
More than 500,000 memecoins were launched in May, fueling a craze that only complicated the situation. Among the influential actors, Andrew Tate stood out with a spectacular action: burned $38 million worth of Solana-based memecoins, thus eliminating 58% of their supply and causing a 130% increase in their price. Although he claimed that he did not personally profit from this action, his intervention undeniably disrupted the market.
This context of instability is not exclusive to Solana. Other major cryptocurrencies, such as Ethereum (ETH), Cardano (ADA) and BNB, also suffered similar losses, while Bitcoin fell to $61,000. The most popular memecoins, Dogecoin (DOGE) and Shiba Inu (SHIB), saw declines of around 5%. It is now up to Solana to demonstrate his resilience to regain the trust of cryptocurrency investors!
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Luc Jose A.
Graduated in Science Po Tolosa and holder of a blockchain certification consultant issued by Alyra, I returned to participate in Cointribune in 2019. Capturing the potential of blockchain to transform numerous sectors of the economy, I have made a commitment to raise awareness and inform the great public about this constantly evolving ecosystem. My goal is to allow anyone to better understand blockchain and learn about the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to convey the latest technological innovations and to put into perspective the economic and social efforts of this revolution in brands.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.