ChatGPT predicts Solana to hit $10K in Q3 2023 but the price chart….
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
Even as Solana [SOL] is touted to be the “Ethereum [ETH] killer,” Solana Labs co-founder Anatoly Yakovenko seems to be in agreement with the idea of using Ethereum as a layer-2 for the Solana blockchain.
Would it be possible for ethereum to be a @solana L2? Probably more likely than you might think at first glance. L2s are bridge protocols that provide one way security. In this setup, holders of solana assets on ethereum would have finality guarantees that they can exit back… https://t.co/XE5ETsxGIW
— toly 🇺🇸 (@aeyakovenko) July 2, 2023
Even Ethereum founder Vitalik Buterin is an admirer of the Solana protocol. When the U.S. Securities & Exchange Commission’s (SEC) filed lawsuits Binance [BNB] and Coinbase [COIN] in early June, it labeled several altcoins, including SOL, as securities. Recently, even Buterin rued the manner in which the regulator is targeting projects like Solana.
The one comment I’ll make is that I feel bad that @solana and other projects are getting hit in this way. They don’t deserve it, and if ethereum ends up “winning” through all other blockchains getting kicked off exchanges, that’s not an honorable way to win, and in the long term…
— vitalik.eth (@VitalikButerin) June 30, 2023
Heading into 2023, SOL was hovering around the $10 support zone. It was already in the grips of a downtrend that stretched back to November 2021, back when SOL was trading at $200. Just as investors began anticipating further losses across the crypto-market in January, Bitcoin [BTC] climbed past $17k and shifted the shorter-term sentiment to bullish.
Solana benefited massively from this shift and recorded gains of 175% in 21 days. However, it could not breach the $26-$28 resistance zone, which has acted as support since June-November 2022.
Read Solana’s [SOL] Price Prediction 2023-24
Meanwhile, the on-chain analytics firm Messari published a report analyzing the degree of decentralization among different chains. Proof-of-stake (PoS) network Solana, with an aggregate Nakamoto coefficient of 1.9, seemed to have outperformed its peers.
The most bullish scenario of 2023, according to AMBCrypto’s prediction bot, could see SOL valued at $75.5. However, we can ask another bot for its take on the price, the network health, and the trajectory of Solana after giving it some relevant data points.
Can we coax ChatGPT into a Solana price prediction if we give it enough information?
ChatGPT has been a remarkable chatbot and the updates of the past month have made ChatGPT 4.0 quite impressive. It is a powerful tool for learning, well-trained on a vast array of topics. Yet, we must remember that the bot is engineered to mimic a human, and is not necessarily guaranteed to be factually accurate. The jailbreak version of ChatGPT would likely be even more inaccurate, as it is specifically instructed to not say no to anything the user requests.
And yet, it is possible to obtain some guesses from the chatbot on what the future might hold if we provide it with details about recent price movements.
So, what does ChatGPT make of Solana? Does it see a route to recovery after its recent setbacks? Based on transaction fees and transaction speeds, ChatGPT seems to think Solana will be an Ethereum killer.
Source: ChatGPT
We are yet to inform it of the challenges that Solana and SOL investors have faced in recent months. Let’s start with the biggest dent in investor confidence –
FTX, where the freefall began
Sam Bankman-Fried was one of the most vocal proponents of the Solana network. The community looked at him as a credible and smart entrepreneur who was the CEO of one of the largest crypto exchanges, FTX. Even though Binance reigned supreme in terms of volume and token pairs, FTX was giving it a run for its money. Competition is also good for the industry and serves the customers.
A lot has changed since then, and the SEC has charged Mr. Bankman-Fried with defrauding the equity investors of FTX, further alleging that he commingled FTX customer funds with Alameda’s to make undisclosed venture investments. He faces over 100 years in jail if convicted on all counts.
Not only has the reputation of Solana taken a hit, but the foundation also sold a significant amount of SOL to FTX Trading and Alameda Research. This amounted to 58.08 million SOL, or 11% of the circulating supply at the time FTX filed for bankruptcy. It was valued at close to $1.1 billion at the time.
As expected, the price of Solana nosedived in November and declined by 45% from November 11 to 31 December, falling from $18.08 to $8. With rumors of FTX’s insolvency circulating from November 5, SOL had already lost 50% the previous week, when it had been trading near the $38 mark. This took SOL’s total losses from 5 November 2022 to 31 December 2022 to 79.4%.
Source: ChatGPT
ChatGPT certainly sounds optimistic, and early 2023 went extraordinarily well for investors. And yet, some network issues cropped up, just as they had in 2022.
SOL gained by 180% in January and February 2023, exceeding all expectations
From 1 January to 20 February, Solana gained 179.88% on the price charts and rallied from $9.69 to $27.12. This explosive rally has been credited partially to Bonk; a meme coin introduced within the Solana ecosystem modeled after Shiba Inu.
A part of the total 99 trillion supply was airdropped into the wallets of Solana users in December. The transaction count per day had been on a downtrend in the second half of December, but this turned around in early January.
Is your portfolio green? Check the Solana Profit Calculator
Soon enough, the transactions were picking up pace once more. The introduction of the fun meme coin did much to bring the community away from the dark, depressing shadow the FTX debacle had cast on Solana.
When fed with on-chain data and price action in recent months, the jailbroken version of ChatGPT pulled up a price of $10K for Solana in Q3 2023.
Source: ChatGPT
The network has faced troublesome outages in recent months, and it might hurt investor confidence. The chat bot agreed.
Source: OpenAI
Predictions aside, what does price analysis tell us about Solana?
Some imbalances remain in the south
Source: SOL/USD, TradingView
At press time, SOL was trading at $19.5, showing a modest rise of 3% within a week. Its value has dipped nearly 20% since the SEC’s enforcement action against Coinbase and Binance.
Both its Relative Strength Index (RSI) and Money Flow Index (MFI) rested much below the neutral 50-level. But its On Balance Volume (OBV) shows an upward movement.
As long as on-chart indicators are concerned, we cannot predict a very bright future for Solana in the short run.
Conclusion
Even as ChatGPT predicts SOL’s price to rally to the ridiculously high figure of $10K during the third quarter of this year, its on-chart metrics paint a dismal picture. It is therefore crucial that traders do their own research before investing in a crypto asset.
