Another Bearish Cycle for Solana

The Solana price is almost 60% below its ATH, indicating that it is losing money to other cryptocurrencies.
Another Bearish Cycle for Solana

The last couple of months has been sad for crypto investors. The overall crypto market cap has dropped by almost $600 billion.

Solana’s bearish move

Solana‘s loss rate was much worse, with a more than 60% correction since its all-time high of $260. Furthermore, attributing underperformance solely to recent network congestion looks overly simplistic, and it ignores the rising decoupling over the last seven days.

In the last three months, the environment has gone through four different circumstances. According to the protocol’s core developers, a quick increase in the number of computing transactions created a massive network load, crippling the system.

DDoS Attacks on the Ecosystem of Solana

Meanwhile, the ecosystem is experiencing congestion, despite the fact that the main developer team claims a 50k TPS capacity. A DDoS attack was blamed for the recent incident on January 7th, although data suggest that platform attacks are less appropriate than DApp usage.

After the platform’s TVL began to hover around $15 billion in November, SOL’s main decentralized application data was initiated to indicate vulnerability. Solana’s DApp deposits in its smart contracts have dropped 44 percent in the last three months, reaching their lowest point since September 8th.

Another Bearish Cycle for Solana

The trader must examine the amount of active addresses within the platform to determine whether DApps are effective. The graphs below show that investor interest in Sol has fallen by 75% in the last three months. The figures were alarming since a reduction in the quantity of futures contracts would reduce the activities of arbitrage desks and market makers.

With a dip in price action, TVL, and derivatives, the SOL price appears to be steadily losing all of its steam. However, if the current trend continues, the altcoin will go below $75. As a result, it’s time for the SOL community to focus less on intermittent outages and more on the platform’s utilization in comparison to other blockchains.