The Solana (SOL) price continued its downward trend on September 17th due to a prolonged outage, indicating high security risks, which shook traders’ confidence.

The SOL fell as much as 13.27% to a September 17 low of $ 133.53, in a corrective trend from a high near $ 221.38 on September 9.

Although the SOL has fallen nearly 40% since a local high was set last week, it has still more than tripled in the past 30 days.

Investors lose interest

Proponents see Solana’s Layer 1 blockchain solution as a direct competitor to Ethereum, largely due to its potential to guarantee higher speeds and lower transaction costs.

However, on September 14th, Solana experienced a service outage (DoS) that increased the transaction load to as much as 400,000 per second over the maximum capacity of the network. As a result, Solana’s mainnet beta was unstable for 18 hours, forcing dApps on its blockchain to shut down.

1 / Solana Mainnet Beta saw a sharp surge in transaction load, which peaked at 400,000 TPS. These transactions flooded the transaction processing queue, and the failure to prioritize network-critical messages caused the network to begin forking.

– Solana status (@SolanaStatus) September 14, 2021

It is believed that the source of the problem lies in the Raydium replacement. Bots then tried to buy SOL tokens and generated a whopping 400,000 transactions per second. On the other hand, the Solana validator lost control of the prioritization of transactions, resulting in a chain split.

SOL fell 19.17% to $ 137.15 on September 14 and rebounded shortly thereafter to close the day down 6.47%. However, the sell-off continued in subsequent sessions amid concerns that Solana is more centralized than Ethereum.

Gavin Wood, co-founder of Ethereum and Polkadot, pointed out that Solana works with a “proprietary and self-contained set of servers,” which increases network speed somewhat at the expense of less decentralization.

The comments come as Ethereum successfully fends off a similar attack.

Lol, WTF is running today? $ sol goes offline for a couple of hours#arbitrariness goes down for almost an hour#Ether was attacked (unsuccessful)

– Lark Davis (@TheCryptoLark) September 15, 2021

“Lol, what the hell is going on today?

SOL is offline for a couple of hours

Arbitrum has been out of business for almost an hour

Ethereum attack failed. “

In a tweet published on September 16, Solana promised to act more proactively against potential hacking attempts. The organization also announced that it would publish a detailed analysis after “researching the attack” in the coming weeks.

Bull flag

The SOL is expected to continue its upward momentum despite the price correction as it establishes a classic technical structure with a bullish outlook on the chart.

SOL establishes a bull flag pattern | Source: TradingView

This pattern is known as the bull flag – which forms when price consolidates down in a descending channel (flag) after a sharp move up (flagpole). Eventually, price breaks the channel’s upper trendline, which usually rises by the height of the flagpole.

A subsequent attempt to break the channel’s upper trendline could propel SOL’s price to the flagpole, about $ 107 or $ 250.

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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.

Teacher

According to Cointelegraph

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