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>>Solana's price faces potential volatility as a concerning pattern develops — what does the future hold?

Solana's price faces potential volatility as a concerning pattern develops — what does the future hold?

crypthub

about 18 hours ago

Solana's Recent Price Performance

Solana's price has risen significantly over the past three months, climbing from around $160 to over $230. This upward trend initially appeared positive for the cryptocurrency. However, underlying on-chain data reveals a contrasting scenario that warrants closer examination. Recent market activity suggests potential vulnerabilities.

Declining Network Activity

CryptoQuant analysis reveals a negative divergence between Solana’s price and the number of active addresses. The "Signer Method," which measures unique addresses successfully sending transactions, shows a substantial decline in activity. Specifically, the 7-Day Moving Average of active addresses dropped from 3.4 million to roughly 2.2 million. This decrease signifies a weakening user base despite the price increase.

Potential Drivers and Concerns

Solana’s recent rally appears less driven by network adoption and more influenced by speculative activity and large transactions. Consistent network activity is crucial for the long-term health of any blockchain. If user activity continues to decline while the price rises, the market might struggle when speculative drivers diminish.

Current Market Status

Solana is currently valued at approximately $186, reflecting a recent decline of over 15% in 24 hours. This correction follows a U.S. tariff announcement on Chinese goods. The cryptocurrency's future hinges on a return to stronger user engagement.