Solana’s native token, SOL, surged 35% between November 5 and November 11, reaching $222, its highest level since December 2021. This move has led investors to speculate whether SOL could reach its all-time high of $260, especially after Bitcoin’s strong rally, fueled by interest from institutional investors and expectations of positive regulation in the US, has it approaching $90,000.
SOL has outperformed the overall altcoin market, which saw a 33% increase in the six-day period ending on October 11, increasing optimism among investors. This positive sentiment is due to the acceleration of smart contract activity on the Solana network. Solana’s total value locked (TVL) reached $7.6 billion as of November 10, the highest level since December 2021. Decentralized applications (DApps) such as Jito, Raydium, Drift, and Binance’s liquid staking feature have contributed significantly to this growth.
Memecoins in the Solana ecosystem, projects like Dogwifhat (WIF), Bonk (BONK), and Popcat (POPCAT), have been criticized in the past, but their combined market cap has surpassed $1.5 billion. Additionally, decentralized token listing platforms like Pump.fun have made significant contributions to Solana’s rise. In the week ending November 2, weekly DEX volumes on Solana reached $17.1 billion, the highest since March 2024. This figure eclipsed Ethereum, corresponding to Solana’s 26% market share.
Solana has also seen success with monthly fees paid by users, which are critical to network security. With a monthly revenue of $88.2 million, Solana has generated higher fee revenues than larger networks like Ethereum. For example, while Solana’s TVL is 7x lower than Ethereum, Ethereum only collects $131.6 million per month, contributions from Solana’s ecosystem have been much larger. These figures include revenues from notable projects like Jito and Raydium.
Magic Eden, Solana’s largest non-fungible token (NFT) marketplace, recorded 77,160 active addresses in the past 30 days, according to DappRadar, while Ethereum’s OpenSea only had 37,940 active addresses in the same period. This data suggests that the Solana network is attracting a strong user base beyond the memecoin craze.
However, it is also important to look at SOL futures to see if traders are overleveraging their positions. A positive funding rate indicates that long positions are paying for leverage. In neutral markets, this rate typically ranges between 0% and 2% per month, while a rate that rose to 5% on November 10th indicated excessive enthusiasm. However, the latest data on November 11th showed a neutral leverage cost of 1.8% per month, suggesting that the market is not overleveraged.
Solana is notable for its strong performance in on-chain and derivative metrics, while the increased activity on the network and the lack of an extreme leveraged market are increasing SOL’s potential to reach new heights. This momentum suggests that Solana will continue to gain traction in the broader ecosystem and attract increasing investor interest.