The Solana Blockchain, one of the leading networks in the dynamic world of cryptocurrency, has witnessed a significant decline in transaction fees in tandem with the general decline in the cryptocurrency market. This raises worries about how the current market downturn may affect Solana’s ecosystem and prospects for long-term growth.
Solana’s Daily Transactions Fees Drops Nearly 100%
In a recent post on the X (formerly Twitter) platform, Kyle Doops, a market expert and host of the Crypto Banter show, pointed out that the daily transaction fees on the Solana blockchain have fallen drastically. As the market continues to be difficult, the decline in daily transaction costs implies a drop in network activity and a reduction in user demand.
According to the market expert, the daily transaction costs on the Solana blockchain decreased to about $639,000. This drop marks its lowest level in nearly 5 months after reaching an all-time high in March this year, representing an 87% decline from the peak.
Kyle Doops noted that this significant fall in daily transaction fees indicates cooling market hype and is driven by a decrease in meme coin activity. He further highlighted that major meme coins on the SOL blockchain have experienced a substantial drop in value, which has led to a downturn in network activity.
While meme coin activity on the blockchain has fallen dramatically, Solana’s stablecoin market cap has increased remarkably, approaching $4 billion. This rise marks its greatest point in over 682 days, particularly since October 2022.
According to Kyle Doops, the rise showcases the growing trust in the Solana ecosystem as demand for its stablecoins grows on Decentralized Finance (DeFi) platforms and in the larger cryptocurrency markets.
SOL Poised For Major Rally Based On Past Scenario
These developments coincide with a notable drop in the value of SOL, as the altcoin has fallen from about $161 to the $146 price level. Although the token demonstrates a bearish sentiment amid larger market pessimism, several analysts are optimistic about a price recovery in the upcoming days.
After the drop in the price of Solana, Trader Tardigrade, a crypto analyst and enthusiast, predicted a potentially massive rally for SOL shortly. The expert’s positive prediction is based on forming a bullish Symmetrical Triangle pattern on the weekly chart of SOL.
Tardigrade asserted that SOL is currently moving in a triangle pattern akin to that of middle 2021. Before that, the crypto asset witnessed a huge rally, which took its price from the $30 to $250 level after breaking out of the bullish pattern, reflecting an over 8x growth.
With the same pattern developing on the weekly chart, the analyst anticipates similar price growth for SOL in the upcoming weeks following a breakout from the zone. Should SOL mirror this increase, its price could surge to nearly $1,200, considering the digital asset’s current price level.
Featured image from Adobe Stock, chart from Tradingview.com
Source: https://bitcoinist.com/solana-blockchain-transaction-fees-declines/