TLDR
- Solana’s total value locked (TVL) reached an all-time high above $12 billion
- SOL price surged 70% between June 22 and August 29
- Solana memecoin market cap gained 70%, reaching $12.4 billion
- A bullish V-shaped recovery pattern projects SOL price to rise toward $300
- Daily memecoin trading volume on Solana jumped 73% to $817.3 million
Solana’s native token SOL has shown strong performance lately, climbing 70% between June 22 and August 29 as part of a broader altcoin market rally. During this period, Ethereum reached new all-time highs above $4,950. While SOL price initially failed to break above $220, causing it to drop below $200 on September 1, it has since recovered 12% from those local lows.
The total value locked (TVL) on the Solana blockchain has seen a substantial increase, rising by over 57% to $12.27 billion on Tuesday from multimonth lows of $7.8 billion reached on June 23. This represents almost a 31% increase in TVL over the last 30 days.
Data from DefiLlama shows that the rise in TVL was led by Raydium, which saw a 32% increase in just one month. Other major decentralized applications on the Solana network also posted impressive gains, with Jupiter DEX, Jito liquid staking, and Sanctum protocol registering increases of 24%, 18%, and 20%, respectively.
SOL currently ranks as the sixth-largest cryptocurrency by market capitalization. Solana is ahead of other top layer-1 blockchains in terms of TVL, though it still remains far behind Ethereum, which maintains its position as the leader in this metric.
It’s worth noting that Solana’s $12.2 billion TVL exceeds that of the entire Ethereum layer-2 ecosystem, which includes platforms like Base, Arbitrum, and Optimism. When the TVL of a DeFi platform rises, it typically boosts liquidity, popularity, and usability, which can have a positive impact on prices.
Memecoin Market Shows Strong Growth
The rise in Solana’s TVL has been mirrored by an increase in the market capitalization of memecoins built on the platform. Most Solana-based memecoins have posted double-digit gains on a weekly timeframe, with the majority up between 15% and 30% from their local lows.
As a result, Solana’s collective memecoin market cap increased to $12.4 billion on Tuesday from $7.3 billion on June 22, representing a 70% climb in less than three months.
This price increase for Solana-based memecoins was accompanied by heightened DEX activity on the layer-1 blockchain. The DEX volume on Solana attributed to memecoins jumped by over 73% over a 24-hour period, reaching $817.3 million on Tuesday, according to data from Blockworks Research.
The surge in memecoin activity on Solana indicates high network activity and rising usage, which positively impacts demand for SOL.
Technical Analysis Points to Higher Prices
SOL’s price action has been forming a V-shaped pattern on the weekly chart since January. A V-shaped recovery is considered a bullish pattern, formed when an asset experiences a sharp price increase after a steep decline. The pattern is completed when the price moves up to the resistance at the top of the V formation, also known as the neckline.
SOL now trades below a supply-demand zone between $200 and $240. A breakout above this zone would increase the chances of the price rising to the neckline at $252, completing the V-shaped pattern. Beyond that, the next target would be the all-time high above $295, representing a 36% increase from current levels.
The relative strength index has increased to 62 from 42 in mid-June, suggesting that bullish momentum is building.
Market analysts appear confident in SOL’s ability to reach new all-time highs. Popular analyst Jussy suggests that once the resistance at $220 is broken, the price could rally toward $270. Another analyst, Kepin, posted on Tuesday that there is “still more upside to the first target of $250” for SOL, adding that “the next target price will be $290-$300, and the ultimate bull target is $350.”
SOL is currently trading above $212 and the 100-hourly simple moving average. There is also a bullish trend line forming with support at $216. On the upside, the price is facing resistance near the $220 level, with the next major resistance near $228. If SOL fails to rise above $220, it could start another decline, with initial support near $216 and the trend line.
