Solana (SOL), also called the ‘Ethereum killer,’ has completed a golden cross pattern that the community had anticipated for days. Notably, the golden cross normally indicates a potential upward price momentum. It serves as a technical bullish pattern confirmation for an underlying asset.
Solana’s Golden Cross Twist
A golden cross occurs when an asset’s short-term moving average exceeds a long-term moving average. That is the 50-day SMA crossing above the 200-day SMA. When this happens, the asset tends to extend its gains over a defined period. Conversely, a death cross signals a bearish price trend.
Solana’s daily SMA 50 has crossed above the SMA 200 on the daily chart, which means more bullish actions ahead. However, the event has not yet translated into an expected bullish trend for the altcoin. Current market data shows that the SOL price was trading for $174.48, representing a 2.83% decrease in the last 24 hours.
This decrease occurred after the coin peaked at $183, fueling investors’ hopes of a further climb to align with the Golden Cross. The last golden cross Solana witnessed, about a year ago, in October 2023, shot SOL’s price by over 890%. That push saw Solana trade for as high as $209 by March 2024.
However, this golden cross comes with a twist for the Ethereum rival, an unusual sign at a time when most coins are growing. Although Solana’s price is down, some community members still anticipate a rally as they expect history to repeat itself.
Solana’s Attraction, Challenges, and Ugrade
Despite its price performance, Solana has remained a favorite among crypto users. Notably, the Layer-1 blockchain has a high throughput, providing secure, fast, and scalable infrastructure for decentralized applications (dApps). Its appeal lies in its low transaction cost; its high throughput surpasses leading blockchains like Bitcoin and Ethereum.
Solana has recorded significant success in the cryptocurrency space. Within seven years, it has become the fifth crypto asset by market capitalization, with over $81 billion.
Despite its acclaim, the Layer-1 blockchain has faced notable challenges, including outages. Notably, Solana developers once misconfigured a node, leading to the network going offline. Other outages were triggered by bots targeting specific protocols on the network. Thus, despite its high-speed attraction, Solana remains vulnerable as validators struggle to handle peak transaction loads on the network.
Solana has implemented major upgrades to address some of these outage issues. While a major mainnet downtime has not occurred recently, many are still projecting the protocol is not out of the wind yet.
Will a Spot Solana ETF Approval Help Flip BNB?
Though touted as an Ethereum killer, Solana is far from testing ETH regarding market capitalization.
Ethereum has maintained its lead as the top altcoin in the crypto space. However, in fourth place, Binance Coin (BNB) is a likely asset to challenge. Analysts say Solana, with its market cap just about $5 billion away from Binance Coin, stands a chance to take on BNB.
The optimism stems from recent interest in Solana’s ecosystem by institutional investors. Some asset managers, including VanEck and 21Shares, have filed for a spot Solana exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission. If approved, the institutional investment in SOL could make a difference that may buoy its valuation soon.
