Solana (SOL) Sets New Yearly High, Surpasses XRP to Enter Top 5 Market Capitalization

In a whirlwind of DeFi vibrancy and a resurgence in memecoin mania, Solana (SOL) has soared to its highest trading value in 20 months, triumphantly claiming the fifth spot in the cryptocurrency market capitalization race, officially dethroning XRP. As per CoinMarketCap data, the peak market cap Solana achieved in the last 20 months stands at a staggering $35.7 billion.

Source: CoinMarketCap

Fuelled by the allure of the DeFi ecosystem and the fervor surrounding memecoins, Solana is surging ahead. The current week has marked a significant milestone with Solana’s Total Value Locked (TVL) hitting $2 billion, a feat not seen since the collapse of FTX in November last year.

Source: DefilLama

Centralized exchanges within this ecosystem are gaining favor among DeFi users, witnessing an exponential surge in trading volumes. On December 15th alone, DEX platform Orca processed over $750 million in trade volume, a stark contrast to the roughly $100 million from the previous month.

The growth surge finds its catalyst in Bonk, a memecoin dominating with a $1.2 billion market cap. Bonk attracted users by airdropping tokens to Saga phone owners within the Solana network. Consequently, Saga phones became scarce commodities, fetching prices as high as $5,000 per device.

Taking advantage of the airdrop frenzy sweeping the crypto community, numerous projects are capitalizing on this trend by distributing free tokens similar to Bonk. Access Protocol, for instance, recently announced a hot reward of 100,000 ACS tokens for each Saga holder.

The heat doesn’t stop there. The memecoin speculation trend is igniting across various ecosystems, not just Solana. Users are hunting for meme coins that could potentially turn a few hundred dollars into thousands overnight.

Typically, they accumulate SOL before converting it into their favored memecoins. When the memecoin surges, they sell and convert back to SOL. This narrative extends beyond Solana to other ecosystems like Avalanche (AVAX) and Injective (INJ), both networks attracting substantial funds and witnessing recent surges in their native coin prices. Yet, SOL seems to receive a more favorable nod.

This blockchain appears to have stabilized, rising from the ashes of past chain halts experienced last year. The ecosystem has also completely distanced itself from the past FTX turmoil, a company that previously held up to $1 billion worth of SOL before filing for bankruptcy.

SOL/USDT 1 day-chart on Binance | Source: TradingView

As of the time of reporting, SOL has just set a new high minutes ago, hitting $84.69, marking a 10% surge in the last 24 hours with no signs of retracement. Trading volume within the same timeframe has surged by a whopping 100%, reaching $3.9 billion.

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