As the broader crypto market consolidates following a sharp rally from early October lows, Solana (SOL) has emerged as a standout performer, outpacing major cryptocurrencies.
With a 17% monthly gain compared to Bitcoin’s (BTC) 13%, Solana’s impressive price surge has been fueled by increased network activity, particularly due to the recent memecoin boom and a renewed wave of institutional investment in Solana-native blockchain applications.
Currently, Solana is trading around a critical support level of $160, having pulled back from recent highs of $183. This level is significant, as a failure to hold above it could prompt a deeper correction, leading investors to question whether SOL can still push toward fresh highs by year-end.
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To assess Solana’s growth prospects, Finbold consulted OpenAI’s ChatGPT-4 for projections on where the asset might head by year-end.
Key drivers fueling Solana’s momentum
Solana’s growth is driven by several key factors, notably institutional investment, increased user engagement, and a thriving DeFi ecosystem.
In Q3 2024, Solana-native applications attracted $173 million across 29 DApps, marking a 54% rise from the previous quarter and the highest investment level since Q2 2022, according to a recent Messari report.
This surge underscores institutional confidence, further bolstered by prominent players like Franklin Templeton, which is launching an SEC-compliant money market fund on Solana.
Additionally, Société Générale’s SG-Forge has announced plans to deploy a MiCA-compliant stablecoin on the network.
Network activity, measured by non-vote transactions and fee payers, also remained strong in Q3 2024.
For instance, average daily fee payers increased 109% quarter-over-quarter to 1.9 million, while new fee payers surged 430% to 1.3 million.
Solana also experienced a resurgence in memecoins, with tokens like Goatseus Maximus (GOAT) driving engagement and revenue, resulting in daily transaction fees peaking at $4 million and active addresses exceeding 8 million.
Collectively, these drivers underscore Solana’s robust growth trajectory, positioning it as a formidable player in the blockchain space.
AI prediction for year-end
Factoring in these elements, AI-driven projections suggest a more conservative yet positive target range of $180 to $190 by the end of 2024.
Solana’s robust growth in institutional investment, user engagement, and DeFi activity has positioned it as a formidable player in the digital asset space.
However, if Solana fails to maintain the $160 support, it may face a deeper correction, challenging its upward momentum and raising investor concerns.
As 2024 progresses, Solana’s ability to sustain its growth trajectory will hinge on these support levels and the ongoing interest from institutions and users alike.
