5 predictions for the cryptocurrency Solana in 2023
Last year was a memorable one for Solana (SOL). With growth of more than 11,000%, it has gone from a relatively unknown altcoin to one of the best cost-benefits of cryptocurrencies on the market. With low transaction fees, it has become an attractive alternative to Ethereum (ETH). Today, Solana is listed on most major cryptocurrency exchanges.
Make no mistake: Ethereum is still the best cryptocurrency of smart contracts. But absurdly high fees and constant network congestion are prompting developers and investors to look for alternatives. Who benefits from that? Who already had SOL in the wallet!
What are the prospects for the near future?
The question is, will Solana remain on the rise in 2022? The crypto world is filled with stories of coins that have had meteoric rises for a short period of time and sharp falls in the following months. This is partly because it is a speculative market that often puts prices at levels outside reality.
So let’s take it with caution! We can’t be sure, but here are some prospects for the Solana cryptocurrency this year:
1. Solana will become less centralized
An important aspect of Bitcoin (BTC) is that it does not depend on a centralized body such as the government or a bank. That said, the fact that the Solana Foundation controls a very high percentage of SOL in circulation in the cryptocurrency market makes its use undemocratic and very dependent on Solana’s shares.
Another problem is that Solana still has a low number of blockchain validators (people responsible for verifying transactions). While Ethereum has more than 275,000 validators, Solana still has just over 1,300.
However, with the growth of the network in 2021, this number tends to grow in the coming months, which makes Solana a crypto to keep an eye on.
2. Increased regulations will have a direct impact on solana cryptocurrency
Increased regulation will have an impact on the entire cryptocurrency industry this year. In the long run, reasonable regulation is likely to increase investor confidence. But we don’t know what the form of regulation will be – and even reasonable regulation will have a short-term impact on prices.
Even under currently existing regulations, Solana may face problems. Its more centralized nature means that the SEC is more likely to categorize it as a title.
This, by the way, is one of the reasons why the SEC is suing Ripple (XRP). Securities need to be registered with the SEC and follow certain guidelines, but if there is no central party leading a company (such as Bitcoin), this should not count as a security. SEC President Gary Gensler has warned that many existing cryptocurrencies are operating with unregistered securities – something he plans to act on.
Taking the situation as an example, Solana developers have taken special care with regulations at source.
3. Solana cryptocurrency will face increasing competition
Solana may have stolen some of the spotlight in 2021, but there are plenty of interesting smart contract cryptocurrencies waiting behind the scenes. There are also a number of underlying blockchains, such as Avalanche (AVAX) and Cardano (ADA). You also need to take into account the second-tier solutions that sit on top of existing networks such as Polygon (MATIC) and Loopring (LRC).
It’s not a scenario where there’s only one winner. But we’re likely to see four or five main rivals emerge. If Solana keeps the 2021 high, it has a good chance of being part of that group. But as we said earlier, a year is a long time for the world of cryptocurrencies.
4. Solana is a good environment for new projects
Today, Solana has more than 1,000 projects in its network. That number will certainly increase next year as more developers migrate to this user-friendly network
For investors, it is also interesting to note the individual projects being developed at Solana. From decentralized financial applications to non-fungible tokens (NFTs) and Web 3.0, there are some interesting new cryptocurrencies taking shape within the platform.
The value of the cryptocurrency Solana will rise again
The Solana cryptocurrency went from $3 at the beginning of the year to $259 in November. Since then, following the fall of the crypto market, it has declined.
More specifically on January 23, Block Chain suffered a bug that paralyzed the network and the cryptocurrency Solana fell 17% in 24h, which left both investors and developers somewhat bothered. However, everything has already been stabilised in terms of functionality.
Today, Solana can be acquired for 67% of its historical maximum, noting a good time to buy, considering that it will potentially rise again – due to all the reasons listed above.
Would you like to know more and/or invest in Solada?