Author: Biraajmaan Tamuly, CoinTelegraph; Translated by: Tao Zhu, Golden Finance

Solana’s SOL token price is expected to achieve a 30% monthly return by the end of July and is expected to challenge its yearly high of around $210 in the coming weeks.

SOL/USD daily chart. Source: Trading View

While most in the community attribute SOL’s success to Solana’s memecoin craze, the network’s strong liquidity staking ecosystem is becoming a powerful on-chain narrative. Let’s see how this trend plays out on the Solana network.

Liquidity Staking Tokens Lead Solana DeFi

Liquidity staking projects Jito and Marinade are the leading protocols on Solana, growing their TVL by 40% and 30% respectively over the past month.

Solana protocol ranking. Source: DefiLlama

Liquidity staking is a process that combines the advantages of staking and liquidity. Holders can stake their tokens in a smart contract or staking pool and receive tokens representing their staked SOL.

This token is called Liquidity Staking Token (LST) and can be used to earn yield on other protocols or for decentralized financial applications. For Jito and Marinade, these tokens are JitoSOL and mSOL respectively.

Data from Dune Analytics shows that the total amount of SOL deposited in liquid collateralized derivatives has more than doubled in 2024. The staked LST increased from 163,827 to 807,712, a 393% increase between June 1 and July 26.

Total staked LST chart. Source: Dune Analytics

Data analytics platform Token Terminal also shows that Solana’s daily and weekly active users have grown by 21% and 59%, respectively. As highlighted above, the growth in active users is in sync with the growth in TVL for Jito and Marinade. Therefore, it can be inferred that memecoins are not the only area currently bringing users to the Solana network.

Solana daily active users (weekly). Source: Token Terminal

Will SOL hit a new yearly high this week?

SOL’s price action shows bullish momentum, and the community expects the price to retest the yearly high of $210. Previously, SOL had broken out of a bullish double bottom pattern, with the current overhead resistance at $202.

The overhead resistance is quite weak and a retest of the yearly high is very likely. However, Solana is currently experiencing a correction and has fallen below the $190 mark.

If Solana continues to follow the bullish trend, its immediate retest target will remain in the $200-210 range. Conversely, if it loses the $180 immediate support area, the altcoin could retest its previous swing lows at $165.

SOL/USD daily chart. Source: TradingView

Meanwhile, options trader Trader Wick is leaning bullish, saying that SOL/USD is once again leading the cryptocurrency market rally.

“Solana is doing great on the rebound, as usual,” he noted.

“Now that resistance has been breached, a breakout of an arrow setup usually starts a whole new trend.”