Solana's on-chain and derivatives metrics indicate high potential

Notably, the demand for leverage through SOL futures remained unchanged due to deteriorating market conditions. Perpetual contracts, also known as reverse swaps, have an embedded rate that, when positive, indicates greater demand for leverage between long (buy) positions. On the other hand, a negative financing rate suggests a greater need for leverage between short (sale) positions.

8-hour financing rate for SOL futures. Source: Coinglass

The data show that the SOL funding rate has remained stable at 0.01% every eight hours since June 8, which translates to about 0.2% per week. This stability in demand between bullish and low positions after a 15% drop in the price of SOL is an indicator of market resilience. If optimists were counting on excessive leverage, we would see a significant increase in the financing rate, which is not the case at present.

The on-chain data of the Solana network shows an increase in the number of users and the volume of transactions. Although some analysts believe that Solana's low rates may encourage data manipulation, this problem is not unique to Solana and affects other platforms such as Ethereum's layer 2 solutions and competitors such as BNB Chain.

Top blockchains sorted by active addresses in 24 hours. Source: DappRadar

Currently, Solana is ranked as the fourth largest blockchain in terms of active addresses in 24 hours interacting with decentralized applications (DApps), with notable activity on platforms such as Jupiter Exchange and Raydium. However, the daily volume of network transactions of $119 million is significantly lower than Polygon's $292 million and Arbitrum's $1 billion.

Despite a sharp correction to $145 on June 11, SOL derivatives and the Solana network remained stable, indicating that traders and users are not ready to give up. The potential for SOL to recover the price of $170 seems feasible, especially if the Solana Foundation's efforts to mitigate the impact of the maximum extractable value (MEV) improve the overall user experience.$SOL