How Solana navigated a problematic Q2
- Solana witnessed a tumultuous Q2 with activity and fees declining on the network.
- Stakers begin to lose interest in the network.
After facing significant challenges such as the FTX debacle and network downtimes, Solana[SOL] has been attempting to recover. In the first quarter of 2023, Solana managed to gather some momentum. However, its growth trajectory was impeded in the second quarter by lawsuits filed by the Securities and Exchange Commission (SEC).
Realistic or not, here’s SOL’s market cap in BTC’s term
The highs and the lows of Q2
Following the SEC complaint and associated delisting, exchanges including Robinhood revealed their intentions to remove SOL from their platforms. This series of events corresponded with a downward impact on the value of SOL. The prices experienced a decline of 9.2% compared to the broader market’s modest 1.3% increase quarter over quarter (QoQ).
As the quarter came to a close, Solana stood as the 10th largest crypto asset in terms of market capitalization, amounting to $7.2 billion, according to Messari’s data.
In Q1 2023, revenue saw support from higher priority fees paid by users. However, SOL’s revenue experienced a 15.0% decrease in Q2 compared to the previous quarter, primarily due to a decline in the proportion of daily fees paid.
The implementation of priority fees played a crucial role in mitigating the network’s past downtime issues resulting from inefficient transaction processing and discouraging spamming activities. Notably, during Q2, an average of approximately 40% of daily fees were paid by users prioritizing their transactions.
This marked a decline from around 50% in the previous quarter. The reduction in users opting for priority fees contributed to a drop in the network’s average transaction fee and subsequently affected Solana’s revenue.
In terms of staking, there was a sharp decline observed on the Solana network. According to Staking Rewards’ data, the number of stakers on the Solana network fell by 21.43% over the course of the last 30 days.
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SOL sees green
Despite the decline in the number of stakers, SOL’s price has managed to see some positive momentum over the last few weeks. After testing the support level of $13.29 on the 10 June, Solana’s price has grown by 65.29%. At press time, SOL was trading at $22.32.
The RSI and CMF for the currency were relatively high, suggesting a bullish future for Solana in the future.