A look at Solana’s state as its price action continues to disappoint

• SOL’s price dipped by more than 6% in the last 24 hours.
• Met­rics were sug­gest­ing a fur­ther price drop, but a few indi­ca­tors were bullish.

Solana [SOL], in the recent past, launched a one-of-a-kind fea­ture for its NFT ecosys­tem, which had immense poten­tial. The fea­ture named State Com­pres­sion reduces the cost of mint­ing 1 mil­lion NFTs on Solana to near­ly $110. 

Real­is­tic or not, here’s SOL’s mar­ket cap in BTC terms

Solana’s latest NFT feature is gaining popularity

For starters, state com­pres­sion is a way to store data direct­ly on-chain that cuts down on cost by mag­ni­tudes of scale. It is already being used by teams across the Solana ecosys­tem to pow­er large, user-friend­ly expe­ri­ences. In fact, Messari’s recent tweet point­ed out how a plat­form huge­ly ben­e­fit­ed from this fea­ture on Solana. 

.@saydialect, a mes­sag­ing plat­form on @Solana, has quick­ly gained pop­u­lar­i­ty by lever­ag­ing the plat­for­m’s #NFT com­pres­sion capabilities.

With a high reten­tion rate and new part­ner­ships, Dialect show­cas­es the poten­tial for con­sumer appli­ca­tions with­in the Solana ecosys­tem. pic.twitter.com/Duo4fO5utK

— Mes­sari (@MessariCrypto) June 6, 2023

As per the tweet, Dialect, a mes­sag­ing plat­form on Solana, quick­ly gained pop­u­lar­i­ty by lever­ag­ing the platform’s NFT com­pres­sion capa­bil­i­ties. Dialect demon­strates the poten­tial for con­sumer appli­ca­tions inside the Solana ecosys­tem, with a strong reten­tion rate and new partnerships.

Solana NFTs aren’t performing well though 

Though the state com­pres­sion fea­ture adds val­ue to the blockchain’s NFT ecosys­tem, things on the ground were dif­fer­ent. CRYPTOSLAM’s data revealed that in the last 30 days, SOL NFT sales vol­ume declined by over 45%. Not only that, the num­ber of buy­ers and sell­ers also went down by 31% and 26%, respectively. 

As per Santiment’s chart, SOL’s NFT trade vol­ume in USD also plum­met­ed. How­ev­er, the good news was that its total num­ber of NFT trade counts increased sharply last month. 

Source: San­ti­ment

SOL investors aren’t elated either

While the NFT met­rics dwin­dled, SOL’s price also reg­is­tered mas­sive declines. In the last 24 hours alone, the token’s price sank by more than 6%. 

As per Coin­Mar­ket­Cap, at the time of writ­ing, it was trad­ing at $18.66 with a mar­ket cap­i­tal­iza­tion of over $7.4 billion. 

The price decline might con­tin­ue fur­ther as LunarCrush’s data revealed that bull­ish sen­ti­ment around SOL dipped by 44%. More­over, the token’s Altrank also increased, which is a bear­ish signal. 

Read Solana’s [SOL] Price Pre­dic­tion 2023–24

Indicators might favor the bulls soon

Most of the met­rics were bear­ish, but a few mar­ket indi­ca­tors sug­gest­ed a price uptick. SOL’s Rel­a­tive Strength Index (RSI) was rest­ing in the over­sold zone. The Mon­ey Flow Index (MFI) reg­is­tered an uptick, giv­ing hope for a north­bound price move­ment in the com­ing days. Nonethe­less, Solana’s MACD revealed that the bears were still lead­ing the mar­ket, which can be troublesome. 

Source: Trad­ingView