Key Highlights
- A sharp decline in memecoin trading drives Solana price fluctuations on the price chart. This once accounted for 80% of its revenue.
- On-chain revenue has dropped 93% since January, and TVL has halved from over $12 Billion to $6.4 Billion.
- A whale liquidated 108,688 SOL for $12.2 Million, resulting in a $7.48 Million loss, highlighting market uncertainty.
Solana price is experiencing significant fluctuations. It was largely due to a sharp decline in memecoin trading and the changing macroeconomic situation.
The memecoin trend from its pumpfun was once the blockchain’s primary source of revenue. Even its memecoin frenzy peaked in January, fueled by the launch of tokens associated with Donald Trump and his wife, Melania.
VanEck said memecoin trading accounted for nearly 80% of Solana’s revenues during this high point. Both have seen dramatic collapses since the TRUMP token and the MELANIA coin were introduced. TRUMP is down 86% from its peak, and MELANIA has plummeted by 95%.
Data from Dune Analytics reveals the daily revenue for Pump.fun, Solana’s leading memecoin trading platform, has dropped 95%. It has fallen from $15 million in January to just $800,000 by early March. This decline highlighted Solana’s growing dependence on this revenue stream.
As Solana crypto on-chain fundamentals weaken and technical risks increase, traders closely monitor key price levels. The situation is evolving, and all eyes are on how Solana Price will navigate these challenges.
Solana Price Fell Below Realized Price Amid Current Weakness
SOL price action remains highly volatile, even after reclaiming the $123 mark after the recent weakness. The asset briefly dipped to $113, the lowest level in over a year, before it bounced back to current levels.
“Market observers are left wondering if the worst is yet to come. Bitcoin fell below $80,000 before recovering to around $82,000 in the intraday session.
Glassnode data underscored this bearish sentiment. This showed that on March 11, SOL fell below its realized price of $134 for the first time in nearly three years. The realized price reflected the average purchase price of all Solana tokens in circulation.
When an asset trades below this level, it indicates that many holders are facing losses. This could lead to increased selling pressure.
The last time Solana price breached this level was in March 2022, resulting in a prolonged downtrend. The asset recovered in November 2023. However, earlier drops in 2020 and 2022 resulted in months of price decline before a significant recovery.
On-chain TVL And Revenue Declined Amid Declining Solana Price
Adding to the challenges, Solana crypto on-chain revenue and total value locked (TVL) have dramatically declined.
According to data from DefiLlama, SOL’s network revenue has plummeted by 93% since January. It has dropped from a record high of $55.3 Million to a mere $4 Million last week.
Similarly, the TVL has halved during this timeframe, decreasing from over $12 Billion to $6.4 Billion. This sharp downturn highlighted the Solana ecosystem’s difficulties as it navigates a turbulent market landscape.
Solana Price Fluctuated With Whale Sell-Off
A Solana crypto whale recently liquidated 108,688 SOL for $12.2 Million in USD Coin (USDC) for $112.3 per token. This nearly matched the day’s lowest price.
This move resulted in a significant loss of $7.48 Million. The whale had withdrawn these tokens from Coinbase 11 months ago when Solana price was trading at $181.
This sale underscored the broader market uncertainty as SOL price fluctuates amid a wider crypto sell-off.
SOL crypto has rebounded to $123. However, concerns remain about its long-term trajectory, especially in light of recent bearish indicators and declining network fundamentals.
At the time of writing, Solana price was trading at a crucial support level. It was down nearly 60% from its peak of $295.
If this support at $120 fails to hold, the price could drop toward the $80 support level. Moving ahead, It could raise concerns for investors.
Disclaimer
In this article, the views and opinions stated by the author or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
