Solana DEX Volume Soars: Will SOL Price Reach $300?

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As an analyst, I’ve observed a steady trend with Solana (SOL) this month, mirroring the market movements of Bitcoin and other altcoins. After experiencing some losses on Monday, it has shown signs of recovery, indicating that investors are keeping a close eye on developments within the Decentralized Exchange (DEX) sector. However, whether or not the SOL price will surge to $300, as speculated due to rising DEX volumes, remains uncertain. It’s crucial to closely monitor market trends and make informed decisions accordingly.

Solana Price Could Benefit From Rising DEX Volume

One significant factor driving up the value of SOL is the consistent growth and increasing dominance of its decentralized exchange networks. As per data compiled by DeFi Llama, Solana now leads as the busiest blockchain in terms of activity within the DEX sector.

In the past week, the transactional volume on Solana’s protocols surpassed Ethereum‘s by a significant margin, managing approximately $27 billion compared to Ethereum’s $16 billion. The surge in activity is largely being fueled by popular Decentralized Exchange (DEX) networks such as Raydium, Lifinity, Orca, and Stabble on the Solana platform.

Solana’s rise in the Decentralized Exchange (DEX) sector can be largely attributed to the popularity of meme tokens such as Pudgy Penguins, Bonk, dogwhizit, and Fartcoin. These tokens have amassed a combined market capitalization exceeding $16 billion, and their 24-hour trading volume surpassed $3 billion.

Increased trading volumes on decentralized exchanges (DEX) within the Solana network is beneficial due to the subsequent rise in transaction fees. A portion of these fees are distributed as rewards for staking Solana (SOL).

A significant factor that could boost Solana’s price is the increasing likelihood that the Securities and Exchange Commission (SEC) will endorse a Solana ETF (Exchange Traded Fund). Currently, these chances stand at 74%, significantly higher than the 59% recorded this month. According to JPMorgan’s recent analysis, if approved, Solana ETFs could attract investments ranging from $3 billion to $6 billion.

Approval for an ETF based on Solana would certainly be significant. This is because it would provide a means for institutional investors in the U.S. to invest their funds into one of the highly regarded cryptocurrency initiatives within the market.

SOL Price Technicals Are Sending Mixed Forecasts

The price of Solana reached an all-time high of $264.75 on November 2023, with many cryptocurrencies experiencing a robust upward trend. However, since then, its value has declined and shifted into a temporary downtrend or “local bear market,” reflecting the ongoing negative sentiment within the crypto sector.

Looking on the optimistic front, the value of SOL returned to test a crucial support level at $188.15. This level is significant because it marked the peak price point for SOL back in May and July of last year. This revisit suggests the formation of a break-and-retest chart pattern.

The price of SOL has created a double-bottom at approximately $175 and also shows a falling wedge pattern, which is characterized by two downward sloping lines converging. This suggests a strong potential for the coin to experience a significant breakout, potentially reaching or even surpassing its 2024 high of $265. A break above this level could indicate further gains up to $300.

On the flip side of the SOL price prediction, it has dipped below its 50-weighted moving average. This might indicate an upcoming bearish trend, possibly pushing the coin down to around $150.

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2025-01-15 16:52