Solana (CRYPTO: SOL) was one of the highest-flying cryptos of 2021. But 2022 has not been as kind to Solana, with the crypto still down nearly 90% from an all-time high of $260, reached in late 2021. So can Solana ever rebound from its current price of about $32 and hit the $500 mark?
There are a number of good reasons to believe that this is possible. Since its public launch in March 2020, Solana has emerged as one of the most innovative blockchains in the crypto world, and the rapid growth of its developer ecosystem shows no signs of slowing. The amount of innovation happening right now on Solana is staggering. Here’s a closer look at some of the catalysts that could help Solana reach $500.
Growing the Solana ecosystem rapidly
The most encouraging sign for Solana is the rapid growth of the Solana ecosystem. After all, the true value of any blockchain is all the activity happening on top of it. Whether it is non-fungible tokens (NFTs), blockchain gaming, or the brave new world of Web3, Solana is seeing an incredible burst of activity. For example, Magic Eden now ranks as one of the most popular marketplaces for buying and selling NFTs. In blockchain gaming, STEPN has skyrocketed in popularity to become the most popular move-to-earn game of the year.
By nearly any metric, Solana is absolutely crushing it. For example, in terms of total value locked (TVL), or the value of crypto assets committed to a decentralized finance (DeFi) protocol, Solana ranks No. 6 among all blockchains. In terms of the pace of developer growth, Solana is growing faster than Ethereum. In terms of NFT transaction volume, Solana ranks No. 2 in the world. With Solana Ventures continuing to fund innovative projects around the world, there is a good chance that Solana will be able to maintain its market-leading position.
Bringing new innovations to market
The amount of innovation coming out of Solana in such a short time is simply staggering. In 2021, for example, Solana launched the Phantom Wallet for the Solana blockchain and quickly lined up more than 2 million users. Then, this February, it launched Solana Pay, an open-source, free-to-use framework built on Solana that is intended to enable merchants to accept crypto payments from customers with near-zero costs.
So what could possibly top this? How about the launch of Solana Mobile and the world’s first-ever crypto phone? This summer, Solana announced the upcoming launch of the Saga, a smartphone for the Android operating system. As a crypto-first mobile phone, the Saga will make it easy to store crypto and digital tokens (including NFTs) on your phone, while also enabling decentralized applications (dApps) and Web3 gaming experiences.
Building the Solana brand
Finally, we have to talk about the Solana brand. This could be the secret sauce that separates Solana from all its Layer 1 blockchain rivals. The Solana Summer meme has rapidly evolved into something much more. What other crypto, for example, has an in-real-life (IRL) retail store? Solana Spaces launched in New York City during the summer of 2022, and there are now plans to open another retail store in Miami. This could help bring more mainstream exposure to Solana.
I don’t think all the excitement around the Solana brand is pure hype, either. On social media, people seemed genuinely thrilled about picking up Solana merchandise. There are the Solana sneakers, for example. And then there is Solana Summer Shandy, the first-ever limited-edition crypto beer powered by the Solana blockchain. Every can of Solana Summer Shandy comes with original Solana NFT artwork.
Solana is a screaming buy at $30
But don’t go overboard here. After all, there are some possible drawbacks to investing in Solana. If the blockchain industry is a “winner take all” industry, as some analysts suggest, then Solana will have to deal with Ethereum (CRYPTO: ETH), the acknowledged market leader. Solana might be doing some innovative things with smart contracts, DeFi, NFTs and gaming, but Ethereum is what made it all possible. With all the performance enhancements coming out of the so-called Merge, Ethereum might simply have too much of a head start for Solana to ever catch up.
However, even the looming presence of Ethereum doesn’t scare me. To me, Solana in the $30 range is a steal. There seem to be so many exciting things happening on the Solana blockchain that a return to its all-time high of $260 from last year seems like a no-brainer. And when you add in the fact that many of the new mobile and Web3 innovations may not have even been priced into Solana, there is room for even more upside. Solana may not hit $500 in 2023, but if you buy and hold for the long-term, getting a 15- or 20-fold return on your investment today does not seem to be out of the question.
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