SOL price rose by 13% at the weekend, following the launch of a new NFT marketplace and rumours of a $450M fundraise.
After hitting an all-time high of over $60 last month, the price of SOL fell with the rest of the crypto market and dipped below $20 a few days later, following the May crash. However, while much of the crypto market stagnated over the weekend, SOL stood out as it surged by 13%.
Solana is a blockchain protocol designed for building decentralised apps (Dapps) that scale, with an open infrastructure geared towards global adoption. The impressive gains made by SOL over the weekend were likely driven by the amount of development currently taking place in the ecosystem.
Sam Bankman-Fried has been investing heavily in the Solana ecosystem, and his quantitative crypto trading firm Alameda Research helped fund Solana hackathon project Step Finance earlier this year.
Bankman-Fried’s crypto derivatives exchange FTX also chose Solana to launch its non-custodial decentralised exchange (DEX), Serum. The DEX has seen a growth in new users and last month passed $4 billion in trading volume.
There are now more than 150 projects in the Solana ecosystem, which grew just last week with the launch of NFT marketplace Metaplex. This has many excited as it enables artists to easily launch their own self-hosted NFT storefronts, and by leveraging the Solana blockchain, it facilitates the minting of NFTs at an average cost of under $1.
And the development is far from over. According to Decrypt, Solana is raising up to $450 million to achieve its goal of becoming the go-to place for Dapps, in a move that could potentially see the project rival Ethereum.
Ethereum gas fees are relatively low at the moment, with an average transaction cost of $3.68. However, those fees will probably rise again before Ethereum 2.0 is rolled out, driving demand for cheaper alternatives.
Solana boasts an average transaction fee of $0.00025, with a sub-second block time and a capacity of 50,000 transactions per second.
After surging at the weekend, SOL continued to rise this morning and is trading at $43.70 at time of writing. The impressive speed and scalability of the blockchain, with its low costs, likely mean we will continue to see ecosystem growth as more projects choose to build on Solana, which could mean further upside for the price of SOL in the future.