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Solana’s native token, SOL, is currently priced at approximately $185.08, struggling to maintain its position after failing to hold above $200 following multiple rejections between December 25 and December 26. This price action coincided with a broader cryptocurrency market downturn, where SOL underperformed with a 5.1% drop compared to the market’s 3.5% decline.

Declining Network Activity and DApp Volumes

A significant factor in Solana’s struggles is a 30% drop in on-chain network volumes over the past week. Despite securing second place in weekly volumes with $20.9 billion, Solana’s performance was the weakest among the top ten blockchains. DApp activity has also declined sharply, with Orca and Phoenix seeing a 39% decrease, while Raydium’s engagement fell by 30%. Interest in memecoins has waned, with notable losses among tokens such as Popcat (down 42%) and Dogwifhat (down 40%).

Derivatives Market Signals Resilience

Despite these challenges, derivatives data suggests some optimism among professional traders. Monthly futures contracts are trading at a 10% annualized premium, indicating a neutral-to-bullish sentiment. However, the funding rate for SOL perpetual futures turned negative on December 27, signaling reduced demand from leveraged buyers.

Outlook: Can $180 Hold?

The decline in Solana’s on-chain activity indicates a moderately bearish outlook for SOL’s short-term price trajectory. Analysts warn that SOL could drop to $167 if current trends persist. However, resilience in the derivatives market suggests limited downside risk below $180 as larger market players continue to show interest. Overall, while Solana faces significant headwinds, there are signs that it may hold above the critical support level of $180 in the near term.