THE price of cryptocurrency Solana soared to a record-breaking high of $258.93 in June last year, but is now trading at much less than this.
We explain how the cryptocurrency’s value has jumped and dived since last summer’s surge – and whether it could hit $200 this year.
Remember that buying cryptocurrencies is always a risky business, and you should only invest what you can afford to lose.
They are extremely volatile, and your cash can fall as well as rise rapidly.
It’s important to only invest in things you understand, and some products and cryptocurrency services can be very complex.
Before investing you should do your research as cryptocurrency firms aren’t regulated like other financial companies.
This means that you won’t have any protection if things go wrong and you could lose all of your money.
What is the price of Solana?
In June, Solana was trading at $258.59 according to CoinMarketCap – but at the time of writing, its value now stands at $98.30.
The cryptocurrency market at large suffered in the second half of last year, hit by market forces and crackdowns by authorities.
The world’s biggest cryptocurrency exchange, Binance, was banned from operating in the UK by the financial watchdog in June.
While China is also getting tough on cryptocurrency mining – the energy intensive method of creating new coins.
A number of authorities across the country have ordered crypto-mining projects to close – including the Sichuan province.
Solana is a challenger to Ethereum as the blockchain of choice for building decentralized applications.
Similar to rivals such as Cardano, the project claims to offer a faster and more efficient alternative.
The idea and initial work of Solana began in 2017, but it didn’t officially launch until March 2020.
Solana price predictions for 2022
Cryptocurrencies are extremely volatile, meaning their prices can soar or tumble very quickly.
This makes it impossible to accurately predict whether they will rise or fall in the future.
That hasn’t stopped crypto fans from trying to forecast Solana’s fortunes.
Solana’s price could hit $250 by the year’s end, according to a prediction by website Coin Price Forecast.
Wallet Investor has estimated it could hit at least $200 in a year.
Meanwhile, according to Finder’s panel of 50 fintech specialists, the price of Solana could hit $1,178 by the end of 2025 and then surge to $5,057 in 2030.
“We think that SOL is one of a few smart contract based blockchains that have the technical architecture that will be difficult for Ethereum to compete with on the basis of transaction speed and transaction cost,” crypto hedge fund general partner Gavin Smith said.
He added: “For smart contract usage especially in DeFi these factors are a critical success indicator.”
What could affect Solana’s price?
Cryptocurrency values can rise and fall based on regulatory decisions by governments and financial watchdogs.
Comments by high profile individuals, such as Elon Musk, can also impact prices.
Although it fell since August last year, Solana was on the rise following a “milestone scalability test” in October.
It hosted the “Degenerate Ape Academy”, a collection of digital artworks (NFT) on Solanart, a marketplace on the Solana network.
Myron Jobson, personal finance campaigner at Interactive Investor, previously told The Sun: “The collection of 10,000 artworks reported sold out in under 10 minutes. Each piece was ‘minted’ using the SOL token.”
He added that “there’s a sentiment among crypto evangelist that Solana has strengthened its status as credible challenger to Ethereum as the blockchain of choice for building decentralized applications”.
Solana’s creators have claimed it is can process more than 50,000 transactions per second.
Mr Jobson said: “However, Solana is pitted against Ethereum which has had a head start when it comes cash injection and time to develop decentralized finance projects.
“In addition, efficiency of Ethereum is expected to improve with upgrades over the long term such as the most recent Ethereum London Hard Fork upgrade.
“Whether Solana can overcome Ethereum’s first mover advantage remains to be seen.
“There are no guarantees that Solana, Ethereum and cryptocurrencies more broadly will be and can be used more effectively on a transactional basis.”
“As such, the crypto marketplace remains highly speculative and volatile.”
But as global crackdowns on cryptocurrencies continue, the coin could suffer.
Earlier this week, Solana – along with Bitcoin, Ethereum and many more currencies – went into freefall after Russia promised to toughen up on the market.