Solana(SOL) was hailed as a virtual asset that could rival Ether with a more environmentally friendly strategy, quicker transaction rates, and more stable pricing. That wager’s backers endured a terrible year. From over $55 billion during the last year’s beginning to slightly over $3 billion during the year’s end, the coins’ market worth plummeted.
Previously, one of Solana’s main issues was its strong ties to Sam Bankman-Fried, founder of FTX. The disgraced former cryptocurrency millionaire was Solana’s vocal supporter, praising the benefits of blockchains and spending more than $500 million on its tokens. Why was $55 billion wiped from Solana? Know more from this post.
Why Was $55 Billion Wiped From Solana?
On 25th December 2022, the two largest NFT initiatives developed on the Solana network declared that they were leaving the platform. However, the most recent slides happened after that information was already public, meaning Solana’s most current slide is somewhat mysterious. Solana has decreased by more than 30% during the past week.
While the largest cryptocurrency only fell 1.2% within the same time frame, Ether remained stable, losing 1.7% of its value. The second most significant decline over that time period among the most valued virtual assets monitored was of Dogecoin, which has dropped 9%.
One of the best wallets for Solana is Ledger. It has helped many other cryptocurrencies come into investments safely. Solana fell 5.8% in only one session of trade last Thursday, down to its lowest level since the beginning of 2021, at the moment the FTX FO started to publicly endorse the project.
Since then, Solana has recovered from its lows, and its market valuation has surpassed $3.5 billion. Its daily volume of trading has increased by nearly 200%. In 2021, when the cryptocurrency market was at its peak, Bankman-Fried wasn’t the only one who had optimism. Most were trying the best wallet for SOL.
Overloads and outages also caused problems for the $55 billion loss from the market cap of Solana. The growing importance of NFTs was a major factor in Solana’s success. Established on Solana was Serum, the platform financed by Bankman-Fried. Last year came around, and Solana’s limits started to show.
Solana was unavailable for more than 24 hours due to a system failure for a month. Between the range of $141 and $94, the SOL coin dropped significantly. A seven-hour downtime in Solana occurred in May last year as a result of NFT minting flooding validators and crashing the Solana ecosystem.
For a system that aimed to challenge Ether’s supremacy and establish itself as a reliable, quick platform, the interruptions were alarming indeed. Solana was going through teething problems in the public. Unlike Ether, which went operational in 2015, the initiative was originally constructed in 2020.
Fewer Innovations And More Downfalls
Complications with innovation should be anticipated. Regrettably, for Solana, there was another development taking place in the Bahamas. The SEC described the deception as “blatant.” The crypto exchanges were shaken by Bankman-exploitation of Fried’s FTX client funds to finance anything from buying and borrowing at Alameda Research to his opulent lifestyle.
FTT, FTX’s native coin, performed the worst, throwing nearly all of its worth. But in the past weeks, Solana has started flying, indicating that there are still persistent worries about the spread of FTX and doubts about the lengthy stability of its own strategy. The most urgent issue is developer migration.
Solana’s goal was to address the problem of Ether and Bitcoin’s inability to “grow beyond 15 Tps globally. However, reports at the time noted that the number of enthusiastic developers on the network has decreased to 67 from a peak of 159 last year. A crypto-purchasing company called Multicoin Capital embarked on an optimistic outlook.
The Phantom wallet icon became popular with Phantom on Reddit because it is a wallet dedicated to Solana. Given recent events, including a wave of job cutbacks and bankruptcy filings by significant crypto enterprises, coupled with some significant macroeconomic headlines, the crypto community appears to be highly gloomy at present.
We anticipate that Solana will reach a maximum price of $17.96 as the market begins to recover as we emerge from the crypto winter. The minimum anticipated price is $11.98; the average price is likely to be in the range of $14.97. Look for a long-term investment instead of a short-term investment.
Summary
Why was $55 billion wiped from Solana? We have understood some facts. Experts predict that Solana can attain a top price of $27.94 next year but the mean price for the entire year will remain at or near $24.95. This is because Solana keeps setting new records. SOL’s lowest possible price next year, in the event of a bearish trend, is $21.95.
If you are looking for the best wallet for Solana NFT, use the Phantom wallet. Experts anticipate a minor rebound during the coming week as buyers take full benefit of this slump as an excellent opportunity to purchase SOL. Over the past seven days, the coin has been exhibiting negative indications. Still, there are hopes.