Solana Price Rises as Weaker US Dollar and Network Growth Boost Bullish Momentum

Quick overview

Solana (SOL/USD) coin maintained its upward trend and remained well bid around above $82.33 level in the early European trading session on Saturday. It is showing 1.66 percent gains in the last 24 hpurs.

There are many factors that are currently supporting the Solana coin, including the upbeat crypto market, the weaker US dollar, and the growing Solana Ecosystem.

Investors returned from the US Independence Day holiday and still digesting the previously released weaker US labor market data, which increased expectations that the Federal Reserve will not raise interest rates anytime soon. This helped the crypto market maintain its bullish momentum and supported further gains in Solana’s price.

Weak Dollar Boosts Solana Price

At that time, the overall crypto market is showing upbeat performance, and its total market capitalization is rising 1.37 percent to $2.17 trillion. Meanwhile, the Fear & Greed Index has improved to 25 from last week’s extreme fear readings of 13. This clearly signals recovering investor confidence, which supports the crypto market.

The reason behind the bullish crypto market could be the weaker US dollar and previously released weaker US job data. The US dollar extended its bearish momentum and is still showing losses near the 100.85 level as investors are still reacting to weaker-than-expected US labor market data. On the data front, the US economy added just 57,000 jobs in June, well below market expectations of 110,000.

Therefore, this weaker data boosted expectations that the Federal Reserve will keep interest rates unchanged. As a result, now see less than 20 percent chance of a rate hike in July. This adds further pressure on the US dollar. Hence, the weaker dollar typically improves demand for risk assets, including cryptocurrencies. This is why Solana coin is rising right now and is set to end this week on the bullish track.

Looking forward, investors will focus on the FOMC meeting minutes on Wednesday and the weekly Initial Jobless Claims data for more clues about the Federal Reserve next interest rate decision.

Solana Growth Helps SOL Price

On the other side, Solana is also getting strong support from its improving network activity. For example, Solana now has around 86 million monthly active users. This is huge as compared with 12.3 million on Ethereum. Solana also handles billions of transactions every month and and records higher transaction volume, DEX trading activity, and fee revenue as compared to Ethereum.

These numbers clearly show that more users are choosing Solana for its fast transactions and low fees. Despite this, Ethereum is still the largest blockchain for total value locked, stablecoin liquidity, institutional adoption, and developer activity. But Solana has become a popular choice for trading and everyday blockchain use.

Therefore, the strong growth in Solana network activity is helping improve investor confidence and supporting demand for the SOL coin.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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