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Solana has been one of the worst-hit tokens during the recent bear market. The token is roughly around 45% below its all-time high. Its performance aligns with that of the broader market. In September last year, SOL had set itself aside as a gainer when the rest of the market was losing, but the token has failed to escape the recent bearish trend.
However, despite these dips, SOL is still maintaining its position as the fifth-largest cryptocurrency, with a market cap of around $45.6 billion at the time of writing.
Solana fails to maintain gains
Solana had earlier attempted a bullish rally after being endorsed by the Bank of America. However, this breakout has shown signs of failing despite analysts predicting that the token could be headed towards new highs.
After the BofA endorsement, SOL became a leading gainer among the tokens ranking in the top ten. It made an upswing of around 10% to $157. However, it has since failed to maintain these highs, with the price now showing signs of making a correction. At the time of writing, SOL was trading at $145, showing a major retracement.
If SOL continues to respond to the performance in the broader market, traders could witness increased volatility. If it continues with the retracement, prices below $140 could be recorded.
If the broader market recovers at this point, SOL could head towards the next major resistance at $169. Such highs could also be created if traders that want to buy during the current dip jump in.
Bank of America endorses Solana
SOL has again come into the limelight after endorsement by the Bank of America. BofA is the largest multinational bank in the US, and in a recently released research note, the institution states that the low fees and high speeds provided by the Solana blockchain made the network the “Visa of the digital asset ecosystem.”
The analysts also supported the popular belief in the crypto market that Solana could overtake Ethereum, given that the latter is dealing with issues of extremely high fees and lagging transactions.
One analyst from the bank, Alkesh Shah, noted that the Solana network had features that made it suitable for use by consumers. These use cases included making small payments and gaming.
“Solana prioritizes scalability, but a relatively less decentralized and secure blockchain has trade-offs, illustrated by several network performance issues since inception,” Shah added.
The latest endorsement by BofA comes when Solana is facing criticism from some members of the crypto community after undergoing several outages.
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