For about 64 dollars, solarium (CRYPT: SUN) It is priced 76% below its January 2025 peak. In the current cryptocurrency bear market, it has not exactly bucked the downward trend, nor has it sparked much enthusiasm among investors.
So at these levels, is Solana a buy, sell or hold?
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Why have sales gotten so bad?
Solana’s struggle is not an isolated phenomenon; Since the end of May, $250 billion has been wiped off the market value of cryptocurrencies.
An aggressive Federal Reserve, alarmed by inflation fueled by the US-Iran conflict, is making the macroeconomic environment very uncertain, which has historically been bad for cryptocurrencies. Similarly, a red-hot stock market for artificial intelligence (AI) and semiconductor stocks has destroyed investors’ risk appetite for cryptocurrencies, as there are evidently many upsides to be found in comparatively less risky plays.
In addition, Solana currently carries a lot of her own luggage.
Since 2024, it has become the cryptocurrency meme coin casino, where launchpad projects generate meme tokens that are designed to get rid of the last buyer. Worse still, Drift, its largest decentralized finance (DeFi) protocol, lost around $285 million in April to North Korean hackers. This is a type of breach that many crypto natives rightly fear could be significantly exacerbated by recently released AI models that excel at cyber intrusion.
And after a streak like this, it’s no wonder people are wondering if cryptocurrency is worth owning, as in many circles the entire sector (and Solana in particular) has become synonymous with losing money to fraud, theft, or many downside risks.
The dust will eventually settle
Despite the above, Solana is far from finished.
It posts the highest real-world throughput of any major chain, handling over 1,800 transactions per second (TPS) as of June 10, and its transaction finality is expected to drop to a fraction of a second once this year’s Alpenglow update is fully rolled out. It is also home to most of the crypto sector’s on-chain tokenized stock trading activity. However, in value, that segment is worth only $1.4 billion across all chains, of which Solana owns $341.3 million, which are rounding errors compared to $120 billion in global stocks.
Another drawback is that network activity does not automatically enrich people who own Solana. On-chain transaction fees cost a fraction of a cent on average, and only a fraction of each fee is withdrawn from circulation, so only a large volume of activity would move the price of SOL, and that’s even before factoring in a steady pace of new issuances that could slightly dilute holders over time.