Widely followed economist Alex Krüger says that Ethereum (ETH) challenger Solana (SOL) is likely positioned for a rally.
Krüger tells his 150,500 Twitter followers that he’s bullish on Solana as the altcoin is likely mimicking the pattern of automatic yield-farming protocol Yearn.Finance (YFI) in 2020.
“PA [price action] makes me think of YFI October 2020.
SOL Dec/2022 = YFI Oct/2020 (in smaller magnitude). This is what I was talking about.”
At time of writing, SOL is trading at $9.84, up over 22% from its 2022 low of $8.03 registered on December 30th. Although Solana has managed to bounce significantly in the last couple of days, it remains down over 96% from its all-time high, which SOL hit in November 2021.
While Krüger expects SOL to rally in the coming weeks, he says he does not see Solana igniting huge upswings.
“Open interest and funding very stretched tell me to expect some mean reversion. Not as violent as with YFI. Alameda not there any longer to squeeze people.”
Krüger also warns that it is very likely that Solana will never revisit its all-time high of around $260.
Meanwhile, market intelligence firm Santiment has a less optimistic view of Solana’s future price action.
“The FUD is strong toward the once thriving asset, but there appears to be some pretty good justification with development activity coming to a halt.”
Santiment adds that one technical indicator shows that interest in Solana is waning.
“Other glaring issues point to trading volume being at year-low levels, and this asset just doesn’t seem to have a lot of signs pointing to any ‘light at the end of the tunnel.’ Although nothing is a guarantee in crypto, probabilities point to SOL being a tough asset to have an argument for hanging on to at this time.”
Ethereum founder Vitalik Buterin is also weighing in on Solana, saying the blockchain may have a future.
“Some smart people tell me there is an earnest smart developer community in Solana, and now that the awful opportunistic money people have been washed out, the chain has a bright future. Hard for me to tell from outside, but I hope the community gets its fair chance to thrive.”
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated Image: Midjourney