Solana Underperforms Peers as Investors Question Disconnect Between Market Cap and Fundamentals
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Solana's native token SOL has underperformed other leading altcoins like AVAX and ETH recently, suggesting the price decline is not tied to macro factors.
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Despite the decline, Solana remains a top contender based on performance and on-chain activity. The 35% 7-day gain shows investors shouldn't adopt a bearish outlook too hastily.
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On-chain data like TVL and fees don't seem to justify significant future demand for SOL compared to competitors. The token supply is also increasing from regular issuance and FTX vesting schedule.
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Solana emerges as a strong player in NFTs due to lower costs than Ethereum, but overall NFT trading volumes on Solana still lag far behind Ethereum.
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The recent SOL price correction likely reflects investors noticing the disconnect between SOL's market cap and its on-chain activity/fundamentals compared to peers. The extent of the correction remains uncertain.