The Block Research recently shared a post on X (formerly Twitter) stating that out of all the top Layer-one (L1) blockchains, only Solana [SOL] registered an increase across all metrics.
Based on the data presented, other L1s, like Ethereum [ETH] and Tron [TRX], had a significant increase in stablecoin supply.
Solana was also not ruled out, indicating increased interest in the cryptocurrency sector.
Source: X
The graph shows that the growth in stablecoin supply across several blockchains indicated that market players had the buying power to drive broad price hikes.
But in terms of daily transactions, fees, and demand for their tokens, Solana outperformed Ethereum and Tron.
Solana: The Ethereum killer
Even as SOL is touted to be the “Ethereum killer,” Solana Labs co-founder Anatoly Yakovenko seems to agree with the idea of using Ethereum as a layer-2 for the Solana blockchain.
Source: X
Even Ethereum founder Vitalik Buterin is an admirer of the Solana protocol. When the SEC sued Binance [BNB] and Coinbase [COIN] in early June, it labeled several altcoins, including SOL, as securities.
Buterin rued how the regulator had targeted projects like Solana.
Source: X
Heading into 2023, SOL was hovering around the $10 support zone. It was already in the grips of a downtrend that stretched back to November 2021, back when SOL was trading at $200.
We asked ChatGPT for its take on the price, network health, and the trajectory of Solana after giving it some relevant data points.
ChatGPT’s take on SOL’s future
ChatGPT has been a remarkable chatbot, and the updates of the past month have made ChatGPT 4.0 quite impressive. It is a powerful tool for learning and training on a vast array of topics.
Yet, we must remember that the bot is engineered to mimic a human, and is not necessarily guaranteed to be factually accurate.
The jailbreak version of ChatGPT would likely be even more inaccurate, as it is specifically instructed not to say no to anything the user requests.
And yet, it is possible to obtain some guesses from the chatbot on what the future might hold if we provide it with details about recent price movements.
So, what does ChatGPT make of Solana? Does it see a route to recovery after its recent setbacks? Based on transaction fees and transaction speeds, ChatGPT seems to think Solana will be an Ethereum killer.
Source: ChatGPT
We have yet to inform it of the challenges that Solana and SOL investors have faced in recent months. Let’s start with the biggest dent in investor confidence –
FTX—where the free fall began
Sam Bankman-Fried “SBF” was one of the most vocal proponents of the Solana network. The community saw him as a credible and smart entrepreneur who was the CEO of one of the largest crypto exchanges, FTX.
Even though Binance reigned supreme in terms of volume and token pairs, FTX was giving it a run for its money. Competition is also good for the industry and serves the customers.
A lot has changed since then, as there is a trial going on against SBF. It has been alleged he commingled FTX customer funds with those of Alameda Research to make undisclosed venture investments. He could face years in jail if convicted on all counts.
Not only did the reputation of Solana take a hit, but the foundation also sold a significant amount of SOL to FTX Trading and Alameda Research.
This amounted to 58.08 million SOL, or 11% of the circulating supply at the time FTX filed for bankruptcy, valued at close to $1.1 billion at the time.
As expected, the price of Solana nosedived in November and declined by 45% from the 11th of November to the 31st of December, falling from $18.08 to $8.
With rumors of FTX’s insolvency circulating from the 5th of November, SOL had already lost 50% the previous week, when it was trading near the $38 mark.
This took SOL’s total losses from the 5th of November 2022 to the 31st of December 2022 to 79.4%.
Source: ChatGPT
ChatGPT certainly sounds optimistic, and early 2023 went extraordinarily well for investors. And yet, some network issues cropped up, just as they had in 2022.
SOL rise in January and February 2023
From the 1st of January to the 20th of February 2023, Solana gained by 179.88% on the price charts and rallied from $9.69 to $27.12.
The explosive rally has been credited partially to Bonk; a meme coin introduced within the Solana ecosystem modeled after Shiba Inu.
A part of the total 99 trillion supply was airdropped into the wallets of Solana users in December. The transaction count per day was on a downtrend in the second half of December, but this turned around in early January.
Soon enough, the transactions were picking up pace once more. The introduction of the fun meme coin did much to bring the community away from the dark, depressing shadow the FTX debacle had cast on Solana.
When fed with on-chain data and price action in recent months, the jailbroken version of ChatGPT predicted that SOL’s price would reach $800 by the end of Q4.
Source: ChatGPT
We also asked the chatbot about Solana’s outages in the past, which might hurt investor confidence.
Source: ChatGPT
Solana’s price charts
Source: Trading view
Solana’s price rallied to $117 in the past week, after holding support at $80 in January. At the time of writing, SOL was trading at $109.44 after dipping by 2.6% in the last 24 hours.
The MACD evinced green histograms above the half-line as the lines were bound northward, indicating that buyers were in command.
The OBV was moving upward to reflect the market’s bullish sentiment.
Conclusion
After Solana’s price hike in the past, investors should keep an eye on the coin’s price movement.
A move to the $120-$125 area would likely present a selling opportunity, while a dip to $105 would offer a buying opportunity.
Is your portfolio green? Check out the SOL Profit Calculator
ChatGPT also seems optimistic about SOL and says Solana has the potential to leave Ethereum in the dust.
But, traders should always remember that ChatGPT is just a tool and its predictions shouldn’t be taken as advice.
