Solana’s On-chain Activity Declines as SOL Price Nears Support

Solana's Price Stabilizes Amidst Waning Trading Interest

Despite a decline in trading activity, Solana (SOL) has witnessed a stabilization in its price, approaching support levels following a recent market downturn.

Significant Liquidations Follow SOL Price Surge

A surge in SOL's price triggered a wave of liquidations, with TradingView data indicating that $13.2 million worth of SOL was liquidated, predominantly from short positions ($9.5 million).

Concerns Raised by Declining New Addresses on Solana Blockchain

However, a concerning trend has emerged: a sharp decrease in new addresses on the Solana blockchain. Over the past fortnight, new addresses have plunged by 14.7%, from a weekly peak of 915,000 to 780,000.

Traditionally, a surge in new addresses has been associated with network growth and enhanced utility, factors that have typically supported SOL's value. The current slowdown raises concerns about potential challenges, such as diminished blockchain appeal or competition from rival platforms, which could hinder SOL's recovery.

Active Address Decline Poses Further Challenges

Furthermore, the drop in active addresses on the Solana blockchain, from 1.21 million to 1.1 million, presents additional hurdles for SOL's price. Reduced user engagement and transaction activity can undermine investor confidence, potentially dampening demand for SOL.

Analysts Foresee Obstacles to SOL's Recovery

Analysts anticipate that SOL's recovery may face obstacles as it encounters resistance levels without significant buying pressure, potentially leading to a reversal for Solana.