Solana (SOL) Reaches Record Daily Users Amid Price Volatility

Solana, the fifth-largest cryptocurrency by market capitalization, has achieved a significant milestone in network activity despite recent price fluctuations. According to data from Artemis.XYZ, Solana’s blockchain recorded its highest number of daily active addresses in history on September 10, surpassing five million users in a 24-hour period.

Record-Breaking User Activity

The surge in daily active addresses comes at a time when SOL’s price has revisited lows from earlier this year. As of the latest update, SOL was trading at approximately $136. Notably, Solana’s user activity far outpaced its closest competitor, which reported just over 2.5 million daily active wallets on the same day.

Solana Price Action and Market Sentiment

Despite the impressive on-chain metrics, SOL’s price has struggled to maintain momentum above the $140 mark since September 10. The cryptocurrency has been testing support at $125, with consistent buying activity at this level keeping it range-bound compared to a month ago.

Several factors are contributing to SOL’s price resistance:

1. Fading Memecoin Frenzy: The hype around Solana-based memecoins, which drove SOL’s price to $210 in March 2023, appears to be cooling off. Notable Solana-based tokens have seen price corrections over the past 30 days.
2. Declining DeFi Activity: Data from DappRadar shows a 70% drop in Pump.fun volume over the last month, with transaction counts decreasing by 30%. The total value locked (TVL) on the Solana network has also decreased by 13% since late August.
3. Technical Resistance: SOL faces significant resistance from major moving averages, including the 200-day EMA at $139, the 50-day EMA at $143, and the 100-day EMA at $147.

Whale Activity and Market Outlook

Recent on-chain data suggests that Solana whales, typically seen as major price movers, may be losing their bullish outlook. A notable whale transaction saw 206,951 SOL (approximately $29.3 million) withdrawn from major exchanges since February 7, with a portion being staked and the remainder potentially sold or moved.

This selling activity implies a lack of long-term confidence among significant holders, which is reflected in SOL’s inability to sustain upward momentum. The Relative Strength Index (RSI) for SOL is currently hovering around 46, approaching bearish territory but still within the neutral range.

Looking Ahead

For SOL to break out of its current range and surpass the $140 level, it will need to overcome the resistance posed by key moving averages and regain momentum in its DeFi and memecoin ecosystems. The recent record in daily active addresses provides a positive signal, but it remains to be seen whether this increased activity will translate into sustained price growth.