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SOL, the native token of the Solana network, is one of the worst-performing cryptos in recent days. Once the darling of the meme coin crowd, the popular blockchain is facing its toughest test yet with its massive price drop and dip in network activity.
SOL is currently trading at $173, but it’s down nearly 10% from last week’s price and 15% from two weeks ago. If we zoom out on its price history, the token is down 27.5% from last month’s price.
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Last Tuesday, Solana shed 10% in 24 hours, triggering concerns among holders and long-term investors. According to on-chain data, the token drop was partly driven by the embarrassing launch of LIBRA, which is currently under investigation. LIBRA’s dump after its launch caused panic among meme coin holders, with SOL as one of its most prominent victims.
Network Activity Drops 55% With Low Volume
Solana’s current woes go beyond the recent price action. According to data shared by crypto analyst Ali Martinez, the chain’s activities are slowing down. A Twitter/X post shared on February 17th noted that the number of active addresses on the network dropped to 8.4 million today from 18.5 million in November 2024. This data reflects a 55% drop, an alarming sign that developers are leaving the platform in droves.
Also, the total volume transferred to the network dropped from $2 billion in November to just $26 million this week. This 99% drop reflects the project’s loss of momentum.
The total volume transferred on the #Solana $SOL network has dropped from $2 billion in November to just $26 million today! pic.twitter.com/qgCOmjd2It
— Ali (@ali_charts) February 17, 2025
More Challenges Up Ahead For SOL
Crypto analysts are bracing for the worst for SOL in the next few weeks. Over the next three months, around 15 million SOL tokens valued at $7 billion will be unlocked. And putting the 4.715% inflation rate in the equation, the increased supply of SOL tokens in the market will create selling pressure.
SOL is currently up, but its price is way below its peak. The token is down 27.5% from last month’s price and boasts a market capitalization of around $84 billion. Now, insiders and investors hope the spot SOL ETFs will be approved in the short term.
Are SOL Meme Coins Next?
The SOL price action benefitted from the surge of newly minted meme coins on the platform. However, the number of tokens minted on the platform has decreased considerably in the last few months. Solana was the platform of choice for degens and developers then, thanks primarily to its fast transactions and low cost.
However, recent events affected the platform’s reputation, particularly the launch of SOL-based meme coins like MELANIA and LIBRA.
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For example, LIBRA was launched with much fanfare, with Argentine President Javier Milei sharing a post and recommending the project. However, minutes after making his post public and pushing the new token past $5, it immediately crashed, leading many to say it was a classic “rug-pull.” MELANIA is also linked to LIBRA; some analysts say they share the same development team.
Featured image from Shutterstock, chart from TradingView
