Solana is one of the hottest blockchain platforms and SOL has been on the rise lately. Rising prices have brought SOL’s market capitalization to over $ 40 billion. Note that the token was only launched 18 months ago and cost less than $ 2 a year ago.
The network suffered a severe downtime due to a lot of community interactions, particularly as Grape Protocol IDO launched on Raydium and bots were sending a large amount of spam into the network. This process causes memory overload, causing many validators to crash, causing the network to slow down and ultimately stall.
Apparently, SOL’s price collapsed after the network crashed. In addition, the aforementioned attack crippled the network validator because it ran out of memory.
Based on the situation diagnosis, the team implemented a hard fork of the network worldwide and received support from 80% (over 1000 validators) of the active stakers. Once restored, the network was patched, updated and fully functional within 18 hours of Solana going offline.
Despite the recent crash, institutional investors are slowly returning to the platform. The Solana fund saw $ 4.8 million in inflows last week, according to digital asset manager CoinShares. CoinShares comment:
“This shows that investors don’t care much about the attack, as they see it initially as a minor problem rather than something inherent in the network. The influx is likely also aided by the speed with which miners are doing the protocol upgrade. “
In the meantime, according to recent news, SOL has been included in VanEck’s crypto-ETN, which is listed on the German exchange operator Deutsche Börse. An Exchange Traded Note (ETN) is a bond that is issued by an Exchange Traded Fund (ETF) company or a bank and traded on the market. Additionally, SOL rebounded more than 13,000%, reaching an all-time high of $ 213.47 on September 9th.
A $ 100 investment in SOL a year ago would have produced a profit of $ 5,000 at press time. In the past few months, the value of SOL has risen parabolically.
However, with a notable devaluation seen on the daily chart, the price is likely to correct itself in the next few weeks. Especially since the upward momentum in the entire industry is disrupted.
Source: trade view
When analyzing SOL’s current market structure, the asset hit an all-time high near $ 215 on September 9th. However, it hasn’t been able to hold over $ 200 for long. With Bitcoin aggressively consolidating between $ 45,000 and $ 50,000 during this period, SOL could continue its upward trajectory relatively easily given its liquidity and continued capital inflows.
Given the bearish momentum flooding the market, SOL is facing a major correction at the time of writing which will be the transition between the 20 simple moving average (SMA) and the exponential moving average (SMA). EMA) 20.
The SMA, which is hovering above the EMA in the daily timeframe, is considered a strong bearish signal. For example, at the time of writing, the asset has shown no signs of recovery.
Source: trade view
In terms of key levels, SOL’s previous trend shows the 0.618 Fib asset is trending up. During the rally in early 2021, the price rebounded to $ 64 before falling to $ 23 in July. A similar trend reversal would drop the SOL below $ 100, with the 0.618 Fib line around the $ 96 level.
The previous high of $ 64 was a strong support on the weekly chart. It can be tested whether the downward pressure in the ecosystem persists.
While the $ 4.8 million cash inflow is positive, it should be noted that such investments will have results in the future, not immediate returns. Hence, this investment-based recovery may or may not occur as profit-taking on the retail side has more control over the market.
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Minh Anh
According to AZCoin News
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