Solana fell 3.85% to US$142, continuing a correction that began after reaching US$160.
Solana's fall of more than 11% was caused by unresolved problems at the network and a poor economic report from the US.
Helius CEO Mart Mumtaz confirmed Solana's network congestion problems.
Solana's (SOL) share price fell about 3.85% today to $142 as of April 26. This drop is a continuation of the correction that began yesterday, when #SOL peaked at around US$160. Since then, its value has fallen by more than 11%.
This drop is due to several factors including unresolved technical issues with the #Solana network and gloomy economic data from the US.
Mart Mumtaz, CEO of Helius, a Solana-based development platform, recently refuted claims that Solana's network congestion problems have been resolved. According to a report by analytics company SolanaFloor published on X's website, the transaction network problems have supposedly been completely resolved by reducing confirmation times, but Mr. Mumtaz claims that operational issues remain.
His comments came just as SOL hit a local high and the token price fell about 11% after his tweet, highlighting the impact of network stability on Solana's market performance. Historically, Solana has been susceptible to price drops related to network issues, in one case the price dropped nearly 14% after a network outage.
The broader economic environment also plays an important role in Solana's current performance. The US economy posted weaker than expected GDP growth of 1.6% in the first quarter of 2024.
At the same time, core inflation rose from an annualized rate of 2% to 3.7%, making a rate cut less likely in the near future. In response to this economic scenario, swap traders lowered their forecast for a Fed rate cut in 2024 to 33 basis points, well below the previously expected six quarter-point cuts.
According to CoinMarketCap, the price of SOL has fallen more than 23% over the past month.
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