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The Solana cryptocurrency became the 11th biggest cryptocurrency by market cap in February 2021. And it could take a top-10 spot any minute...
The SOL price reached a high of $55 in May 2021, after trading under $2 to start the year. Now at $35, the price of SOL has dropped significantly since then. But it appears stable relative to other cryptocurrencies out there still.
In fact, one Solana price prediction puts it at 442% by 2022.
A market-wide cryptocurrency sell-off managed to take the SOL price as low as $21 that same month. But it's not uncommon to see crypto prices with such hyperbolic rises collapse right back to original levels in these markets.
As always, we look for the cryptocurrencies built to stand the test of time. We want the most energy efficient, secure cryptocurrency allowing for the fastest crypto transactions. And Solana may fit the bill.
It has over 272 million coins in circulation, and the supply is not fixed like Bitcoin's.
However, the coin does have a decreasing "annual inflation rate" according to the company website. The coin's inflation rate is expected to decrease by 15% per year until it goes from 8% to a "long-term stable rate" of 1.5%.
Recently, the company reported $450 million in new financing. This gave some credibility to the idea that Solana might be the "Ethereum Killer" every coin wants to be.
Here's more on Solana and why its price seems to have reached consolidation at current levels. Then, we will show you the big Solana price prediction for next year.
What Is Solana Crypto?
The Solana blockchain was created by Solana Labs. The company was founded in 2017 by former Qualcomm Inc. (NASDAQ: QCOM) engineers Antoly Yakovenko and Greg Fitzgerald. The token itself was launched in April 2020.
The goal of the Solana blockchain is to be an Ethereum competitor. Both Ethereum and Solana want to control the decentralized financial markets. But Solana believes it can take on ETH by being faster and cheaper.
In fact, the Solana blockchain processes more than 1,000 transactions per second, Ethereum only 14. The Solana website boasts a "maximum theoretical throughput" of 50,000 per second.
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These blockchains all have "consensus algorithms" to validate transactions, and some are faster than others by design. Ethereum uses a proof of stake (PoS) algorithm and Bitcoin uses proof of work (PoW). Solana combines a PoS algorithm with proof of history (PoH).
PoH makes it so that you don't have to merely trust the timestamp on a transaction. You can verify that a transaction took place before or after a certain event. PoH sort of acts as a "clock" in how it can measure the passage of time between events and offer more reliable verification.
PoS is known to be faster than PoW, as people aren't "mining" the coin by solving complex equations. The algorithm just has to find the individual with the highest amount of a cryptocurrency on the particular blockchain to decide who creates the next block.
A combination of PoH and PoS work to make the Solana blockchain more secure. And that's only part of why Solana is winning right now...
Solana Cryptocurrency Is Growing Fast
Solana has about 250 crypto projects in the works.
It recently announced Solanax, an automated market maker (AMM) to facilitate trades on a decentralized exchange. This is expected to launch in 2022.
Meanwhile, another electric market maker, GTS, said it will join the Pyth Network. This is great news, because the Pyth Network actually uses the Solana blockchain.
Along with these deals, Solana is doing everything it can to grow and get the word out. The company recently said it would invest $20 million in support of developers working on Solana projects.
It launched another $20 million fund in South Korea with ROK capital. Solana wants to expand its South Korean footprint over the coming years.
Now, with all these developments taking place, here's what the Solana price is doing and where it's headed.
Solana Price Prediction 2025
The price of SOL crypto moved up and down between $0.50 and $1.50 through 2020. The all-time high of $58.40 came in May 2021 as cryptocurrency rallied overall - that was when Bitcoin was rallying to its peak of $68,000, reached in April.
SOL crashed as low as $19.14 following its peak. But it then bounced back above $40.
Here are the Solana price predictions going forward.
CoinCodex - With the coin down at $35, it's passed a technical support level of $36 and may only find support at $27 if it goes down further. If it moves higher, it could go as high as $52 this year.
DigitalCoinPrice - An even higher price prediction comes from DigitalCoin. It's projecting $62 in 2021 and $76 in 2022. By 2025, DigitalCoin expects the SOL crypto price to climb to $125.84, then $200 in 2028.
WalletInvestor - Here's the highest price target for SOL yet. WalletInvestor expects SOL to reach $190 by 2022. And by 2025, they expect it to hit $473.
The bottom line is that, if you're looking for an "Ethereum Killer," Solana is one to watch. Transaction speed, security, and adoption are among its strengths. These factors will ultimately separate one cryptocurrency from the rest.
It's Official: This Coin Has Taken Command over Bitcoin's Crypto Dominance
Investors who snagged $1K worth of Ethereum five years ago would have nearly $1,500,000 today.
Today, just one ETH is worth over $3,000; that's about 20X higher in just over a year.
But ETH is just one of many - these even smaller coins share the same DNA structures as coins like Ethereum: Coin No. 1 is up nearly 40% in the last 24 hours.
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About the Author
Mike Stenger, Associate Editor for Money Morning at Money Map Press, graduated from the Perdue School of Business at Salisbury University. He has combined his degree in Economics with an interest in emerging technologies by finding where tech and finance overlap. Today, he studies the cybersecurity sector, AI, streaming, and the Cloud.