Solana’s 22x hike from 2022’s low flips BNB – Is Ethereum next?
Increasing on-chain activity was likely boosting Solana's value.
- Solana beat Ethereum in DEX volumes for the second straight day.
- Fees on Solana hit an all-time high on the 17th of March.
In a significant achievement, Solana [SOL] leapfrogged Binance Coin [BNB] to become the fourth-largest cryptocurrency by market capitalization, presenting a compelling case for inclusion in investment portfolios.
According to CoinMarketCap, the altcoin, which underpins one of the largest smart contract networks, increased by more than 10% in the last 24 hours. It reached $200 for the first time since October 2021.
At press time, SOL was 22x higher than the lows of the 2022 crypto winter.
Network activity imparts value
The increasing on-chain activity was likely boosting the coin’s value.
Solana logged the highest decentralized exchange (DEX) volumes for the second straight day, surpassing Ethereum [ETH] and all its associated layer-2 (L2) networks, AMBCrypto noted using DeFiLlama’s data.
As evident below, Solana’s weekly DEX volumes have been growing steadily over the past month, reaching an all-time high (ATH) of $17.5 billion last week.
Higher engagement with DEXes meant a higher number of transactions, and therefore higher fees. Solana recorded its highest on-chain fees on the 17th of March, totaling $3.82 million.
Ethereum’s on-chain fees have declined in recent days, while Solana’s have increased. If the trend holds, Solana could flip Ethereum as the chain with the highest fees.
Since the network burns a percentage of the fees earned in SOL, such high levels of network utilization indirectly aided the coin’s upward climb.
Increased profit-taking a worry?
Even whales found it tough to resist the temptation, seeing SOL’s rally. According to Lookonchain data, large investors started offloading their SOL holdings to make profits.
How much are 1,10,100 SOLs worth today?
One particular whale moved a whopping 200k SOL coins, worth $40 million at press time, to cryptocurrency exchange Binance over the past two days.
While this may reflect profitability now, a sustained period of whale sell-offs could apply brakes on the ongoing rally.
