Crypto Bounce Leads to Surges in Solana, Ethereum, and Lido DAO

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What happened

With 2022 in the rearview mirror, investors seem to be looking at the new year with fresh eyes and a much more optimistic outlook. For crypto investors, this is certainly the case, with the overall cryptocurrency market appreciating more than 4% in the past 24 hours as of noon ET.

Among the top performers today is Solana (SOL 23.14%), which jumped 23.6% over the same period. This incredible move appears to be the result of renewed enthusiasm for the Solana Network following the recent airdrop of BONK, another Shiba Inu-themed meme token. This airdrop matched various Solana-based NFT projects and resulted in a sharp increase in network activity over the past week.

At noon ET, Ethereum (ETH 5.70%) hit a respectable high of 5.8%, but Ethereum liquid staking platform Lido DAO (LDO 20.98%) largely outperformed, rising 26.4%. % in the last 24 hours. The move appears to be tied to expectations that liquid staking platforms, such as Lido, could see outsized volume increases, particularly in derivatives trading.

So what

Solana’s decision is worth exploring, as it has been among the hardest hit of the top 25 cryptocurrencies over the past year. Once a challenger to networks such as Ethereum, Solana has since seen a series of network outages and projects leaving its network, sparking investor interest in other crypto assets in 2022.

As a result, despite many investors’ hesitation about meme tokens, it’s interesting to see how catalytic this recent airdrop has proven to be.

For the entire Ethereum network, last year’s merger and this year’s upcoming Shanghai upgrade (expected around March) are key catalysts that long-term investors will likely continue to watch. Notably, it’s likely that liquid staking solutions like Lido could see even greater interest in the medium term, as this upgrade opens up the possibility for stakers to withdraw tokens that have been stuck since late 2020.

Now what

Today’s remarkable increase in these three popular crypto projects should come as no surprise. Almost across the board, risk assets are rallying strongly today. A number of major factors are behind the widespread sense of risk that seems to be taking hold.

That said, these tokens also have their own catalysts, priced today. This is the main difference between today’s rally and previous rallies – investors are paying attention to what is happening. If investor interest remains high, this rally may actually have some legs (unlike last year’s mini-rallies, which all collapsed).

Chris MacDonald holds positions at Ethereum and Solana. The Motley Fool holds and recommends Ethereum, Lido DAO, and Solana. The Motley Fool has a disclosure policy.

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