Key takeaways:
Investments from corporate treasuries are driving steady demand and bolstering SOL’s price momentum.
The dominance of DEXs, growth in fees, and interoperability advancements strengthen Solana’s competitive position in the blockchain space.
Solana’s native token SOL (SOL) encountered a significant rejection after reaching the $250 mark on Sunday. Despite this correction, SOL has risen 24% in the past month, aided by robust onchain activity.
Traders are currently pondering whether the existing momentum could propel SOL toward $300, especially as the Solana network has reclaimed its position as the leader in decentralized exchange (DEX) trading volumes.
In September, Solana eclipsed Ethereum to emerge as the primary blockchain for DEX trading, processing $121.8 billion in monthly transaction volumes—around 90% higher than the BNB Chain. Securing dominance in this area is crucial as increased volumes lead to higher fees, which creates ongoing demand for SOL to facilitate those transactions.
Data from Nansen indicates that fees on Solana increased by 23% over the past week. This rise is particularly significant considering Ethereum maintains nearly seven times more total value locked (TVL). However, ETH holders experience minimal benefits from this volume, as many decentralized applications, including restaking and real-world assets (RWA), demonstrate low activity and weak fee generation.
Corporate treasury allocations drive demand for SOL
Recent corporate treasury movements have heightened demand for SOL. Some companies are gathering capital through stock or debt offerings and channeling the proceeds into cryptocurrency. A notable example is Forward Industries (FORD), a former medical and technology design firm, which raised $1.65 billion in private funding to acquire SOL for its reserves.
Forward Industries received financing from Galaxy Digital (GLXY) and Jump Crypto—both a market maker and venture capital fund—as well as Multicoin Capital, recognized for early investments in Helium (HNT), Filecoin (FIL), Solana, and Polkadot (DOT). Separately, DeFi Development Corp, a treasury firm focused on Solana, disclosed holdings exceeding 2 million SOL, valued at over $460 million.
Additionally, Pantera Capital, a prominent blockchain asset manager, announced on Monday the launch of a new Solana-backed treasury vehicle, Nasdaq-listed Helius (HSDT). An initial private placement of $500 million was co-led by Hong Kong-licensed fund manager Summer Capital, which could expand to more than $1 billion, according to the press release.
Related: Bitcoin and Solana ETPs lead $3.3B crypto inflow rebound: CoinShares
Another potential boost for SOL arises from a proposed open-source bridge linking Solana with Base, an Ethereum layer-2 developed by Coinbase. Base has accrued over 20 million active addresses in the last 30 days, according to Nansen. The bridge would enable users to transfer assets across chains, fostering a more “interoperable and connected” ecosystem, as described by Base creator Jesse Pollak.
The Trump-backed crypto initiative World Liberty Financial (WLFI) also announced on Monday a partnership with Solana’s memecoin platform Bonk.fun and the Raydium DEX to finance “multimillion-dollar promotional rewards.” This initiative targets USD1 stablecoin pairs, with WLFI’s token reportedly fully backed by US dollars and cash equivalents.
With Solana’s increasing onchain activity, the accumulation of SOL by treasury-focused firms, and the visibility from the Base bridge and WLFI initiative, traders are optimistic about further price increases. A rise to $300 would elevate Solana’s market capitalization to $163 billion, still representing a 70% discount compared to Ether’s $543 billion valuation, making this scenario feasible in the near future.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
