Popular cryptocurrency exchange Kraken has suggested that the price of Solana ($SOL) could rally up to 260% by the first quarter of next year based on technical analysis of its price performance since 2020.
In its November 2021 Market Recap and Outlook report, Kraken detailed that Solana has been in a “broadening ascending wedge” and “appears in the early innings of its fourth wave of price discovery.” Kraken wrote in its report:
Should Solana continue to follow this pattern and re-enter price discovery mode, one could expect Solana to move north towards the about $600 resistance into the first quarter of 2022.
According to the cryptocurrency exchange, Solana’s pullback from its all-time high in November from around $260 to around $167 at the time of writing, could be interpreted as a bullish sign for the cryptocurrency and as a sign “that a test of the wedge’s resistance could follow in the month(s) ahead.”
Kraken added that the “longer it takes for SOL to trend higher while also retaining the wedge’s uptrending line as support, potentially the higher SOL could travel before ultimately cooling off and entering into a downtrend.” The exchange sees Solana potentially hit $600 before it starts to move down.
As CryptoGlobe reported, the total value locked (TVL) on the decentralized finance ecosystem built on top of Solana grew in November while Ethereum transaction fees hit a new all-time high that month, suggesting investors rotated to Solana over its cheaper transaction fees.
According to CryptoCompare’s latest Asset Report, decentralized finance activity on the Solana blockchain continued to grow last month, but at a slower pace when compared to October. It grew 15.8% from October to $14.4 billion, compared to its 35% growth in October and 177% in September.
Over 77% of Solana’s $SOL tokens are being staked on the cryptocurrency’s network and earning their holders yield, so much so that staked value on the network surpassed $84 billion, according to data from Staking Rewards.
The network’s staking rewards have as such been making Solana a top choice for investors looking to earn interest in their cryptocurrency holdings. Staking allows users to earn interest in their crypto by helping secure the underlying network.
Solana itself is a high-performance blockchain founded by former Qualcomm, Intel, and Dropbox engineers that uses a delegated Proof-of-Stake (dPoS) consensus algorithm. The network uses a unique method of ordering transactions to significantly improve its speed and throughput.
Late last week, popular pro-cryptocurrency web browser Opera revealed its built-in wallet is set to add support for SOL early next year in a timeline that could see it support the ecosystem ahead of competing browser Brave.
DISCLAIMER
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
IMAGE CREDIT
Featured image via Unsplash
