After piercing through the $20 barrier earlier this week, Solana (SOL) continues on its upward trajectory, buoyed by growing user engagement and recent bullish comments by the project’s co-founder.
Over the past week, SOL’s price climbed around 10%, propelling the cryptocurrency’s market cap from $7.6 billion to $8.4 billion. At press time, Solana was trading at $21.14, up 1.5% in the past 24 hours.
Most of SOL’s gains came during the week as the crypto token’s price action over the last month remains in the red, down nearly 4%. Still, year-to-date, Solana’s price jumped by a whopping 112% from just $9.99 at the start of 2023.
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Solana currently faces a resistance level of $21.40, which, if broken, could potentially position the cryptocurrency for another major upside move toward the $25 level.
Solana expert insight
Meanwhile, crypto expert Altcoin Sherpa pointed out a crucial support level at $20.73 highlighting this area as ‘a scary spot’ for SOL and breaking below it would likely push the token’s price down as low as $14-$15.
On the other hand, the next obvious resistance level for the cryptocurrency stands at $26, as noted by trading expert Jimie.
“IF SOL can close above the trailer ($21.3) then longing/buying is maybe a good idea.”
– he added.
What is driving SOL’s price?
Primarily, Solana’s latest price rally has been fueled by a drastic surge in the network’s number of unique users.
According to on-chain data, the number of active weekly users on Solana skyrocketed to 3.6 million on May 1, marking a significant increase of 146.58% from April 1, according to Dune Analytics data.
Following the spike, the cumulative number of unique active users on Solana stood at 39.75 million on May 1, up from 36.15 million a month earlier, the chart shows.
According to Messari’s research analyst Ally Zach, one of the factors that attracted new users and played a crucial role in their onboarding process is the shifting focus of Solana’s gateway apps.
Additionally, new features such as “programmable NFTs and NFT compression, as well as @solana’s low cost, high throughput environment, make it an ideal network for consumer applications to thrive,” Zach added.
Over the past year, the focus of these apps has transitioned through different sectors, from decentralized finance (DeFi), over gaming and non-fungible tokens (NFT), to a mix of the aforementioned markets.
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