Title: Solana Shows Bullish Potential Following Ripple’s Legal Victory
[Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.]
The price of Solana (SOL) experienced a significant increase of nearly 30% after news broke of Ripple (XRP) securing a partial victory in its legal battle against the U.S. Securities and Exchange Commission (SEC) on July 13.
The U.S. District Court of the Southern District of New York ruled that the sale of Ripple’s XRP tokens on cryptocurrency exchanges and through programmatic sales did not qualify as investment contracts, meaning it was not considered a security in this particular case. However, the court did find that the institutional sale of XRP tokens violated federal securities laws.
This judgment resulted in a rallying effect across various tokens within the crypto industry.
Despite being commonly referred to as the Ethereum killer, Solana Labs co-founder Anatoly Yakovenko seems open to the idea of utilizing Ethereum as a layer-2 solution for the Solana blockchain. Even Ethereum founder Vitalik Buterin has expressed admiration for the Solana protocol. When the SEC recently sued Binance and Coinbase, it labeled several altcoins, including SOL, as securities. Even Buterin criticized the regulator’s targeting of projects like Solana.
Heading into 2023, SOL’s price remained relatively stable around the $10 support level. However, it had been trending downwards since November 2021 when it was trading at $200. In January, when investors were anticipating further losses in the crypto market, Bitcoin’s price surpassed $17,000, shifting the sentiment to bullish.
Solana benefited greatly from this shift and recorded gains of 175% within 21 days. However, it failed to break through the $26-$28 resistance zone, which had been a supportive level since June-November 2022.
According to a report by on-chain analytics firm Messari in June, Solana appeared to have outperformed its peers in terms of decentralization, boasting an aggregate Nakamoto coefficient of 1.9.
One prediction suggests that Solana could reach a value of $75.5 in the most bullish scenario for 2023. However, it is important to note that these predictions are based on assumptions and should not be taken as factual.
Despite these positive indicators, Solana faced a significant setback when one of its vocal proponents, Sam Bankman-Fried, CEO of FTX, was charged by the SEC with defrauding equity investors and commingling customer funds with Alameda Research. This incident damaged Solana’s reputation, and the foundation sold a significant amount of SOL to FTX Trading and Alameda Research, causing the token’s price to plummet in November, resulting in a total loss of 79.4% from November 5 to December 31, 2022.
In the early months of 2023, Solana’s price performed exceptionally well, experiencing another upward rally. However, network issues emerged again, similar to those in 2022.
Taking into account recent price movements and on-chain data, a price of $400 for Solana in the third quarter of 2023 is predicted. It is important to note that the network’s recent outages may have an impact on investor confidence.
As of the time of writing, SOL is trading at $28.85, representing a significant increase of 28% following the SEC-Ripple ruling.
While the Relative Strength Index (RSI) remains below the neutral 50-point, the Money Flow Index (MFI) comfortably surpasses the neutral 50-level. Additionally, the On Balance Volume (OBV) indicates an upward movement.
Both ChatGPT’s prediction and on-chart metrics support a bullish outlook for SOL’s price, with a potential rally to $400 in the third quarter of 2023. However, it is crucial for traders to conduct their own research before making any investment decisions in the cryptocurrency market.
