Solana price is having a difficult year as concerns about the network remain. SOL has crashed by more than 70% this year, making it one of the worst-performing big-cap cryptocurrencies in the world. Its market cap has dropped to $12 billion.
Solana challenges remain
Solana is one of the biggest blockchain projects in the world. It is a smart contract project that makes it possible for developers to build quality decentralized applications (dApps). In fact, it has been used to build some of the biggest projects in the industry.
Some of the most popular dApps created in Solana are Solend, StepN, Audius, Brave, and Magic Eden among others.
Recently, however, there are challenges in its ecosystem. For example, the total value locked (TVL) in Solana’s ecosystem has dropped from more than $15 billion to the current $1.3 billion. This decline has happened across chains, including Ethereum and Avalanche.
However, a quick look at its DeFi apps shows that only 7 apps have a TVL of $100 million and above. Solend has a market dominance of almost 20%.
Meanwhile, like other chains like Ethereum, Flow, and Immutable X, the volume of Solana NFTs has been in a downward trend in the past few months. After peaking at more than $311 million in April, the volume dropped to more than $129 million in September. Broadly, there are concerns about the future of the NFT industry.
Still, the biggest challenge for Solana is its growth amid the regular outages. Last week, the network went offline in its sith outage this year. The outage came a year after a nearly 18-hour outage that happened in September last year.
Therefore, there are concerns about whether new developers will continue moving to the network. Besides, platforms like Avalanche and BNB rarely have such outages.
Solana price prediction
The four-hour chart shows that the SOL price has been in a tight range in the past few days. In this period, the coin has remained between the ascending channel shown in green. It is also consolidating at the 25-day and 50-day moving averages while the Relative Strength Index (RSI) has moved slightly above the neutral point at 50.
So, is it safe to buy Solana? the outlook of Solana at this stage is neutral with a bearish bias. If this happens, the next key support level to watch will be at $32, which is the lower side of the ascending channel.
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