Solana’s daily stablecoin trading volume appears to have suddenly plunged in a mysterious dip that suggests that while Solana was seeing between $75 and $100 billion worth of daily stablecoin trading volumes, it’s now at a modest $7 billion.
The apparent plunge has left investors unsettled, with some pointing to wash trading as a potential explanation. Wash trading sees a trader or traders buy and sell an asset to inflate its trading volume by acting as the buyer and seller of that asset, creating an illusion of high activity.
This practice artificially inflates trading volumes and can mislead investors about the true level of adoption and liquidity on a platform.
The decline comes as the price of Solana’s native SOL token keeps dropping from a 45-day low, a cryptocurrency analyst has recently predicted that despite a current bearish trend the smart contract platform’s native token will move to surpass the $1,000 mark in the future.
Solana is at the time of writing trading at $138 after losing around 18% of its value over the past month amid a wider cryptocurrency market downturn.
On social media a pseudonymous cryptocurrency analyst, Crypto Patel, showed a long-germ SOL price chart suggesting it could move to the $1,000 mark. The chart shows the formation of a giant cup and handle pattern.
A cup and handle pattern occurs when the price of a security trends downward and recovers to form a “u” shape, before seeing another slight downward drift that forms the handle. It’s widely considered a bullish signal.
Also read: AI Prediction: Ethereum (ETH) vs Solana (SOL) – Which Is Likely the Better Buy for the Rest of 2024
Featured image via Unsplash.
