On-chain analytics firm Glassnode revealed the reasons why Solana (SOL) has recently lagged behind Bitcoin (BTC) and Ethereum (ETH).
The growth of Solana's realized market value has recently slowed down.
In a new post by Glassnode on X, the recent performance of Solana is discussed in comparison with the two largest tokens in the industry. The analytics firm noted: 'In terms of price performance, SOL outperformed ETH and BTC for most of Q4 2024.' 'However, since early December, ETH has been in the lead, performing better than the other two assets.'
Currently, Bitcoin has risen about 18% in the past month, Ethereum has risen 28%, and Solana has risen 3%. Thus, SOL has clearly fallen after previously being a market leader.
What is the reason for this shift in the market? The answer to this question may lie in the capital flows observed recently in these cryptocurrencies.
To estimate the capital flow of assets, Glassnode used the actual market value metric. 'Actual market value' refers to an on-chain capitalization model that calculates the total value of any digital asset by assuming the 'actual' value of any token in circulation is the price at its last transaction on the blockchain.
Since the last transfer of any token likely represents the time point of its last handover, the price at that time can be regarded as its cost basis. Therefore, the actual market value is the sum of the cost basis of all tokens in circulation supply, or more simply put, it is an indicator of the total capital amount invested by investors in cryptocurrency.
From this perspective, the changes in actual market value essentially reflect the amount of capital exiting or entering the asset. Below is the chart shared by the analytics firm showing the 7-day change of this metric, illustrating the outflows/inflows of Solana and others.
From the chart, it can be seen that the 7-day change in realized market value was at a distinctly positive level during the period from September to early December. During this time, Bitcoin and Ethereum also saw capital inflows, but the growth rate of SOL was significantly faster.
However, this month, the industry saw a reversal, with both Bitcoin and Ethereum surpassing Solana. The earlier higher capital inflows may have been the driving factor behind SOL's strong performance, thus, with these capitals disappearing, it is also reasonable for the top two assets to take over.
SOL Price
Although Bitcoin and Ethereum have surged in the past few days, Solana has remained in a consolidation phase, trading around $221.
