Solana (SOL) has undergone an interesting turn of events by losing its position as the fourth-largest cryptocurrency by market capitalization to Binance Coin (BNB). An impressive monthly increase of 120% in December propelled Solana’s market capitalization above BNB, but a drop in the price of SOL occurred after Christmas, marring the excitement.
The SOL token, which reached its all-time high at $123 on December 26, has experienced a correction by falling below the $100 mark, currently trading at $109.55, according to CoinMarketCap. This turn of events has allowed Binance Coin to reclaim its position as the fourth-largest cryptocurrency, with a value of $319 after an unexpected 9% increase.
The Recent Volatility of Solana Generates Much Speculation About Its Stability
The volatility in Solana’s price has been a subject of attention and speculation from enthusiasts and investors. Despite the impressive rally in December, Solana’s retracement has raised questions about the sustainability of previous gains. This price fluctuation has impacted not only Solana but also SOL-based memecoins such as Bonk (BONK) and Dogwifhat (WIF), which saw a notable increase between November 22 and December 22, followed by a retracement that exceeded 50% from their all-time highs.
A key element during Solana’s surge was the significant increase in trading activity on its network. For a brief period, trading volumes on SOL-based decentralized exchanges (DEXs) even surpassed those on the Ethereum network, marking a key moment. However, this trend has subsided, with Solana’s DEX volumes currently representing approximately half of Ethereum’s trading volume in the same period.
As Solana experiences this fluctuation, Ethereum (ETH) has shown a resurgence with a 5% increase in a week. With the current price at $2,378, Ethereum positions itself as a strong and stable competitor in the crypto space.
