Solana Price Prediction: Can SOL Reach $500 This Cycle?

$SOL

In the past week, Solana (SOL) struggled to gain, with its price at $167.12, similar to its value on May 25. Despite a 52.63% Year-To-Date (YTD) increase, this is modest compared to its 2023 surge. However, Solana bulls remain optimistic, expecting SOL to hit $500 by the end of this cycle.

1. Correlation with Bitcoin

Solana's price movement is strongly correlated with Bitcoin (BTC), with a correlation coefficient of 0.83. Therefore, SOL's potential rise to $500 depends heavily on BTC surpassing its all-time high.

2. Social Dominance and Market Sentiment

Solana’s social dominance is currently low at 4.938%, historically a good buying opportunity, suggesting now might be an optimal time to buy SOL between $161 and $168.

3. Open Interest and Potential for a Rally

Open Interest (OI) for SOL has decreased to $807.25 million. If OI rises past $2 billion again, SOL could see a significant price increase, potentially reaching $334 in the coming months.

4. Total Value Locked (TVL) and Network Activity

Solana's Total Value Locked (TVL) is $4.80 billion, up 20.27% over the past 30 days. A rise in TVL to $8 billion could enhance demand for SOL, pushing its price toward the $500 mark. The increasing supply of stablecoins on Solana suggests there is ample buying power to drive SOL's value higher.

While recent price action has been lackluster, various metrics indicate potential for significant growth. The correlation with Bitcoin, low social dominance, potential rise in Open Interest, and increasing TVL and stablecoin supply all contribute to a bullish outlook. If these conditions align, Solana could indeed reach or exceed $500 in the current cycle.