Opinion: Solana’s comeback shows how quickly the token space changes
Written by Mel Gelderman
Posted on November 15th, 2023
As Solana outperforms other major token projects in the market, Mel Gelderman comments on why SOL's comeback was expected, and learnings we can take from the rise.
As we head towards the end of 2023, tokens are showing signs of life. But one project is leading the pack: Solana. The high-speed Layer 1 network suffered this time last year when FTX collapsed. But it’s had a better 2023. SOL is up 500% year-to-date. Since I highlighted it in late October, SOL has doubled in price. But there’s more to the recovery than price action.
“Anyone watching the space closely has expected this for a while.”
Building through 2023 💪
With SOL’s rise and new projects launching, the network’s daily active address count topped Ethereum’s last week. But anyone watching closely has expected this for a while. In August, Solana Pay integrated with Shopify to let merchants use USDC for payments. Visa then announced it would settle USDC payments on the network in September (the payments giant previously made a similar announcement about Ethereum).
Solana co-founders Anatoly Yakovenko and Raj Gokal. The two engineers are highly respected within the project’s community (Photo: Alfonso Duran/Fortune)
The project’s team has also made strong marketing efforts, coining phrases like “only possible on Solana” to highlight the network’s speed benefits. This strategy clearly worked. The ecosystem has attracted many passionate builders and people are taking notice.
“Projects can bounce back stronger if they have substance and community support.”
Solana’s $8 moment 📉
There are some learnings to take from this case. After FTX’s meltdown, many declared Solana dead due to the project’s ties to the exchange. But SOL’s $8 moment shared similarities with ETH’s $80 moment in 2018. In both cases, the supportive contrarians were rewarded. When projects endure extremely tough bear markets, they can bounce back stronger if they have substance and a real community behind them.
Solana has sometimes been described as an Ethereum competitor, but Vitalik Buterin showed support for the project when SOL crashed to $8 in December 2022.
I’m not saying to go all in on Solana—the best time to buy is before projects rise. I also think it’s a good idea to maintain Bitcoin and Ethereum as core positions. But looking for outliers can pay off. As we’ve seen in 2023, even when things look bleak, the story can change extremely quickly. So stick through the downturns and keep an open mind.
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