Solana Cryptocurrency Returns With Dramatic Price Surge

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It’s a real comeback – the comeback with a bang of a cryptocurrency that many pundits and industry sources gave up almost for dead after Sam Bankman-Fried’s empire went bankrupt on Nov. 11.

Solana (SOL), they said, was not going to be able to survive the earthquake represented by the fall of cryptocurrency exchange FTX and its sister company Alameda Research, a hedge fund that also serves as a trading platform. trading for institutional investors.

FTX and Alameda were the main companies representing the Bankman-Fried crypto empire, known by the initials SBF, in the crypto space.

‘Sam Corner’

Solana indeed had close ties to Bankman-Fried. Dubbed ‘Sam coin’, Sol is a token issued by the Blockchain Solana, which allows the development of decentralized finance or DeFi projects that offer financial services such as loans, mortgages, financial products, etc.

The token is linked to an on-chain crypto exchange called Project Serum, created by Bankman-Fried, who resigned on November 11 following the bankruptcy of his empire. Serum is a liquidity hub.

Serum is one of the foundations of the Solana DeFi infrastructure, as it is the protocol and ecosystem that brings high speed and low transaction cost to Solana DeFi. It implements a central limit order book and on-chain matching engine, helping to share liquidity and provide powerful trading functionality for institutional and retail investors.

Serum is asset-independent: it gives developers full control and flexibility to build trading applications that leverage the liquidity and benefits of Serum’s ecosystem.

As if to prove Cassandra right, Sol prices thus fell by 73% between the start of FTX’s difficulties on November 6 and December 31. They ended the year at $9.96 from $32.72 on November 5.

SOL is up 79%

But as fast as they crashed, land prices are also rebounding very strongly. In the last seven days, they have increased by 79% according to data company CoinGecko. Sol is knocking on the doors of the top 10 cryptocurrencies by market value at last check. The token belonged to this club before its collapse.

Prices are currently trading at $23.39, up 134% year-to-date.

The sentiment around Solana changed after a statement of support from Vitalik Buterin, one of the most influential voices in the crypto space.

“Some smart people tell me that there is a community of serious smart developers at Solana, and now that the horrible opportunistic money has been washed away, the channel has a bright future,” said Buterin, one of the co-founders. of Ethereum, the most powerful platform in the crypto sphere, wrote on Twitter on December 29.

He added that: “Hard for me to say from the outside, but hopefully the community gets its fair chance to thrive.”

For many industry sources, the resurgence of SOL is also due to a growing demand for decentralized finance projects. The Solana blockchain allows developers to create decentralized applications, or dApps, at low cost and offers speed in the execution of transactions.

Its scalability, speed, and affordability make it an attractive option for DeFi projects that need to process large amounts of transactions quickly and at low cost.

“As traders celebrate the resurgence of #Bitcoin (back to over $21,000) and #Ethereum (back to over $1,550), #Solana is the real star as the weekend kicks off,” commented on-chain analytics firm Santiment. “Up +22% in the past two hours alone, $SOL was fueled by liquidated shorts.”

Santiment suggests that the strong rebound in Sol prices is due to a “short squeeze,” which is a sudden spike in the price of an asset due to investors betting against the asset being forced to buy it in order to limit their losses.

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