TL;DR
- Solana’s Market Cap Nears ATH: Solana’s market capitalization is nearing an all-time high (ATH) of $80 billion, with the current price of SOL being $172, up nearly 14% in the last 24 hours.
- Rising Token Supply Concerns: The supply of SOL tokens has increased from around 300 million to 443 million since the previous bull market. This surge in supply, without a corresponding increase in demand, could dilute the token’s value and impact investor sentiment.
- Solana’s Attraction: With lightning-fast processing times, Solana has attracted interest from both small-time and institutional traders. The Solana Foundation’s focus is to make decentralized finance accessible on a larger scale.
The Solana network is close to achieving a notable landmark, with its market capitalization nearing an all-time high (ATH) of $80 billion. Yet, a less discussed issue could cast a shadow over this accomplishment: the supply of SOL tokens has swelled from around 300 million to 443 million since the previous bull market. This surge in supply could significantly impact the token’s value and the sentiment of investors.
Not sure why no one is talking about this but $SOL is very very close to hitting it's Market Cap ATH at close to 80B
Why you ask?
Because the supply has increased from around 300M to 443M since the last bull market 👀 pic.twitter.com/kMiKSWYctE
— decypher (@decypher_xyz) March 13, 2024
As of now, Solana is trading at its best value of the previous 22 months and is moving towards the ATH value of $260.06. The current price of SOL is $172, up nearly 14% in the last 24 hours, and a weekly 23% gain, with a market cap of $76,525,313,894. The fully diluted valuation (FDV) stands at $98,655,029,318. The 24-hour trading volume is $7,017,663,817
However, concerns are rising over the increasing token supply. The circulating supply of SOL is 443,616,251, with a total supply of 571,851,967. This increasing token supply could impact the market price of SOL.
When the supply of a cryptocurrency notably expands without a corresponding increase in demand, it can result in the token’s value being diluted. For those who have held SOL for a long period, this inflation in the circulating supply implies that their proportion of the network’s market capitalization has reduced.
This situation is similar to a company issuing additional shares; the worth of existing shares usually falls unless the company’s market valuation rises in a balanced manner.
The Attraction of Solana: Lightning-Fast Processing Times and Large-Scale DeFi Accessibility
With lightning-fast processing times, Solana has attracted interest from both small-time traders and institutional traders alike. The Solana Foundation’s significant focus is to make DeFi accessible on a larger scale.
However, it’s important to note that the increasing circulating supply of SOL may impact its market price. Depending on the tokenomics, emission schedule, or lock-up period of SOL’s supply, it may take a significant time before its entire supply is released into circulation.
In conclusion, while Solana is nearing its ATH market cap, investors should keep an eye on the rising token supply concerns. As always, it’s crucial to do thorough research and consider multiple factors before investing in any cryptocurrency.
