Solana’s SOL token went above US$ 200 on Thursday (9/9), in the fourth consecutive day of all-time highs. In the last 30 days, the token’s value has multiplied fivefold. The reason is increased interest in faster, scalable, and cheaper alternatives to the Ethereum blockchain amid the explosion of NFTs (non-fungible tokens).
Google Trends, a tool that measures overall trending interest, indicates that Solana-related terms are at their historical peaks of popularity.
Interest began to increase with the launch of the NFT Degenerate Apes project on August 15. The token began its sharp rise from then on, and has been sustaining the appreciation despite the current scenario in the rest of the crypto market.
The spike in interest does not necessarily imply an increase in actual demand from retail investors, but it indicates a positive future outlook on the platform’s adoption.
Solana’s record may indicate overbought
The spike in general interest in SOL is accompanied by a reading above 70 or overbought on the relative strength index (RSI), a widely used technical analysis in the market. A reading above 70 indicates that the bullishness is overdone, and the asset may experience some consolidation or correction.
According to Coindesk, the volume of mentions of the coin on crypto social media channels reached a record high of 8.802 this week before dissociating from the rising price on Wednesday. High levels of comments regarding the topic usually act as a counter indicator.
In this context, JPMorgan warned retail investors on excessive optimism about SOL, ADA, and BNB.
“The August high in non-fungible tokens and the acceleration in DeFi activity helped not only ether, but also alternative cryptocurrencies that facilitate or plan to facilitate smart contracts, such as Solana, binance coin and cardano.”
NFT platforms experience slowdown
Most NFTs in Solana, including Degenerate Ape Academy, has experienced a fall in volumes over the past 24 hours, according to Solanalysis.com. Although collectibles in Solana have generated US$ 95 million in turnover over the past seven days, the weekly growth rate has been flat.
The expansion of the NFT seems to be slowing down. OpenSea, the world’s largest NFT market, posted a trading volume of less than US$ 100 million on Wednesday, the lowest since August 21, according to Dune Analytics. Other popular NFTs like Loot and CryptoPunk have also seen a sharp drop in trading volumes in the last 24 hours.