Solana’s native token, SOL, experienced a sharp 5.5% decline between Oct. 9 and Oct. 15, struggling to hold the critical $150 support level. As of Oct. 17, SOL continues to trade in negative territory, down 2.3% in the past 24 hours to $152.27, according to data from Cointelegraph Markets Pro and TradingView.
The recent downturn highlights ongoing challenges for Solana, with bearish trends spreading across its ecosystem.
Solana-Based Memecoins Flash Red
The drop in SOL’s value coincides with a correction in Solana-based memecoins, signaling shifting investor sentiment toward the blockchain. Leading memecoins like Dogwifhat (WIF) and Book of Meme (BOME) posted significant losses in the past 24 hours.
- Book of Meme (BOME): Down 7.3% to $0.0087
- Dogwifhat (WIF): Dropped 3.7% to $2.56
The total market cap of memecoins on the Solana blockchain also decreased by 2.1% to $10.5 billion, reflecting declining enthusiasm for speculative tokens within the ecosystem.
Declining Network Activity Weighs on SOL Price
The bearish sentiment is reinforced by a drop in Solana’s network activity, further pressuring the SOL token. Fewer users are interacting with the blockchain, and decentralized finance (DeFi) applications on Solana are losing momentum.
- Transaction volumes have dropped to $1.7 billion on Oct. 17, down from $2 billion just three days earlier, according to DefiLlama.
- DApp activity is also in decline, with DappRadar reporting a 53% drop in transaction volume over the past week.
- Unique Active Wallets (UAWs) interacting with Solana’s smart contracts have fallen by 48% in the past seven days.
This slump in activity reflects broader concerns about the sustainability of Solana’s DeFi and NFT markets and suggests waning interest among users.
From a technical perspective, SOL’s price action remains trapped within a bearish triangle that has been forming since March 2024, when the token was rejected at its multi-year high of $209.
If SOL cannot reclaim the $161 resistance from late September, the token could target $125 as the next support. A failure to hold this level could trigger a drop to $75, representing a 50% decline from current prices.
What’s Next for Solana?
The latest correction suggests that Solana’s struggles are not just technical but also fundamental, with network activity and investor confidence declining. While short-term recoveries may occur, SOL’s ability to reclaim higher levels depends heavily on a resurgence in network usage and memecoin performance.
Also Read: Ethereum’s DEX Market Share Drops Below 40% As Solana And Base Surge With $33.8B In Volume
For now, Solana’s bearish outlook and weakening on-chain metrics signal that both SOL and its ecosystem could face further challenges in the coming weeks.
Solana’s native token SOL and its memecoins are under significant pressure, driven by declining network activity and waning investor sentiment. As technical indicators flash warnings of further downside, the blockchain faces an uphill battle to regain momentum. Will Solana bounce back, or is more turbulence ahead? Investors will be closely watching the $125 support level for clues.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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