Solana Price Drops 5% After Paypal PYUSD Hit The $1Billion Mark: Will it Switch?

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As a seasoned crypto investor with years of market observation under my belt, I have learned to navigate the ebb and flow of this dynamic industry with cautious optimism. The recent milestone achieved by Paypal PYUSD, becoming the fifth largest stablecoin, is indeed noteworthy. However, the lackluster response from Solana’s price after such a significant event is a reminder that the crypto market often dances to its own rhythm.

Paypal’s PYUSD stablecoin has surpassed the $1 billion market cap, making it the fifth largest stablecoin. As a stablecoin, its value is tied to the US dollar and hovers around the $1 mark. Recently, it has outperformed USDD and True USD. Notably, the Solana network serves as the primary blockchain for this stablecoin. Contrary to expectations, however, the price of Solana tokens saw a nearly 5% decrease following this milestone.

Analzing Solana Price Under Paypal PYUSD Influence

Solana ranks as one of the leading five digital currencies, boasting a track record of substantial returns. Remarkably, it continues to generate buzz, even amidst its average long-term market performance. Presently, the SOL price stands at $154.10 following a 4.27% decline over the past day, with this dip also affecting its market capitalization, now sitting at $71,701,311,951. Nonetheless, a 22% uptick in trading volume suggests the potential benefits stemming from PayPal’s involvement, represented by PYUSD.

Solana Price Drops 5% After Paypal PYUSD Hit The $1Billion Mark: Will it Switch?

Previously, PayPal’s PYUSD product introduced an interest reward system, contributing significantly to its market value increase. Interestingly, while PyUSD, built on the Solana platform, accounts for 64% of the market share, its influence on the price of SOL was more than anticipated. Surprisingly, despite hitting a peak of $260.06 nearly three years ago, SOL has struggled to reach such heights since then.

In a twist of events, the strongest performance prior to an all-time high (ATH) was recorded in April 2024, as the token peaked at $202.87 only to drop due to market fluctuations. Now, anticipation is growing for the approaching bull run that promises to boost altcoin prices, including Solana’s.

Will Solana Switch To An Uptrend Anytime Soon?

Despite Solana’s ongoing 5.22% weekly growth, today’s nearly 5% decline has fallen short of expectations, even as progress with the Solana-based stablecoin is commendable. For the last three days, Solana has been in a holding pattern, with potential resistance levels at 190.01, then 207.21, and finally 235.05. Notably, the SOL currently hovers beneath its Pivot, but it has managed to rebound above the recently established support level of 134.33.

If the altcoin advances towards its resistance level and successfully breaches the initial hurdle, it could potentially maintain its upward trajectory. Furthermore, the heightened trading activity suggests a strong buying demand for the altcoin, hinting at potential profits ahead. Yet, due to the market’s increased volatility following Pavel Durov’s 12 criminal charges, consolidation seems to be prevailing.

In the long run, there’s a strong possibility that the price of Solana could rise significantly due to the anticipated interest rate reductions in September, as Jerome Powell has confirmed the FED will lower rates. This news resonated across all cryptocurrencies, including Bitcoin, Ethereum, and Solana, suggesting a considerable increase may occur once the cuts take effect.

Final Thoughts

For several days now, Solana’s worth has been holding steady. Interestingly, PyuUSD reaching a $1 Billion market cap didn’t affect Solana’s price, leaving many of its holders feeling let down after anticipating an uptrend following such news. However, with increased demand for the token and potential Federal Reserve interest rate cuts on the horizon, there’s hope for another upward trend. This could drive Solana’s value towards the $200 target.

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2024-08-27 16:50