- Glassnode noted that much of the increased activity appeared to be driven by bots, raising questions about the authenticity of Solana’s growth.
- Solana’s price remains strong, holding around $240, with traders predicting further gains.
The Solana on-chain activity has skyrocketed to new highs as the SOL price continues to hold around $240 levels. Market intelligence firm Glassnode recently stated that the Solana blockchain network saw its on-chain transfer volume hit record highs.
What’s Behind Solana’s Skyrocketing Transfer Volume?
In a post on the X platform on Tuesday, November 19, Glassnode notes that the transfer volume of Solana touched an all-time high of $318 billion on November 16. Interestingly, this is nearly three times Solana’s current market cap of $112.5 billion. Moreover, the total number of active addresses on Solana has also surged to 22 million.
However, it turns out that most of this activity has been due to bots. However, the on-chain analytics firm observed a decline in both mean and median transaction volumes around the same time. such a development raises doubts about Solana’s metrics as the organic growth should typically reflect a corresponding increase in the averages. While explaining this entire scenario, Glassnode said:
This pattern of network activity inflation may be indicative of bot-driven activity, which has historically contributed to similar trends on Solana.
This ramped-up activity was majorly responsible for the sharp surge in the Solana network fees and revenue, per the CNF report. On Wednesday, November 20, the daily revenue for the blockchain also hit a record high of $6 million with network participants paying $7.3 million in transaction fees, per DeFiLlama.
On November 19, the layer-1 network reached a record-high decentralized exchange (DEX) volume of $6.93 billion, with Raydium accounting for 74% of Solana’s DEX trading volume at $5.13 billion, according to DefiLlama data.
The inflated activity has led some critics to question the network’s growth metrics. Claims of wash trading in meme tokens and other suspicious practices have sparked skepticism regarding Solana’s reported performance in recent months.
Solana Price Outlook
However, Solana’s price is still seeing significant bullish activity from investors despite all of the voiced concerns. Trader Pseudonymous analyst Titan of Crypto predicted SOL native tokens to hit $400, saying that they could break out of this cup-and-handle pattern. Veteran trader Peter Brandt deemed the push upward part of broader swings in markets and put a short-term target on it of $275.
Often times price moves in swings whereby the swings are relatively equal in price. I am sure Elliott traders get quite precise (as they tend to do ) but I just use swing targets as a guide pic.twitter.com/QBGzOAZTHi
— Peter Brandt (@PeterLBrandt) November 18, 2024
The Solana price has increased considerably over the last weeks. In the previous week, the SOL value gained 14%, and in the past month, it surged nearly 45%, reported CNF. As of November 18, its market capitalization reached a peak of $117.8 billion, solidifying SOL’s position as the fourth largest crypto asset.
