Solana price is up today, trading above $160 and up 8% over the last 24 hours.
Data from Cointelegraph Markets Pro and TradingView shows SOL (SOL) price rallying for a third day after rising 24% from a low of $129 on Aug. 6.
SOL’s performance has seen its market capitalization rise to $74.42 billion, topping BNB Chain’s BNB (BNB) to become the fourth-largest cryptocurrency by market cap.
Let’s look at the reasons why Solana’s price is up today.
Brazil’s CVM approves first spot Solana ETF
The uptick in the SOL price on Aug. 8 follows news that Brazil’s Securities and Exchange Commission (CVM) approved the first spot Solana exchange-traded fund (ETF).
According to a report by a local business publication Exame, the SOL ETF is provided by QR, a company known for managing Bitcoin (BTC) and Ether (ETH) ETFs, and will be operated by fund administrator Vortx. The ETF is still in a pre-operational phase, pending approval by Brazilian stock exchange B3.
This marks the first product of its kind and among the first Solana-based investment products globally. There are currently only Solana exchange-traded products, such as the 21Shares Solana ETP in Switzerland, the CoinShares Physical Solana and the ETC Group Physical Solana, both traded on the German exchange Deutsche Börse Xetra.
Even though CVM’s approval puts Brazil ahead of the United States in the race to launch a spot Solana ETF, the Securities and Exchange Commission is expected to decide on several applications, including investment management firm VanEck’s application for a spot SOL ETF in the US.
Following the successful launch of spot Bitcoin and Ether ETFs in the US and other countries around the world, the spot Solana ETFs are expected to attract large capital inflows into SOL’s market and possibly drive up the price.
Solana outperforms Ether as SOL/ETH ratio hits all-time highs
SOL is up 60% year-to-date, outperforming Ether and other top layer-1 tokens. ETH’s price has climbed only 12.5% since Jan. 1, 2024, while other large-cap layer-1 tokens, such as Avalanche’s AVAX (AVAX) and Tron’s TRX (TRX), have rallied 12% and dropped 42%, respectively, over the same timeframe.
The SOL/ETH trading pair has been forming higher highs on the daily chart since June 23, hitting a new all-time high of 0.0643 on Aug. 8.
Veteran trader Peter Brandt said that it was inevitable that Solana would emerge as the “clear winner” in the superiority battle against Ethereum because of low transaction fees and user-friendliness backed by a “great foundation.”
This rise underscores Solana’s strengthening position in the crypto market. The chart reveals a consistent upward trend driven by robust buying activity.
According to the data provided by Dune Analytics dashboard pump, SOL’s price rise on Aug. 8, in particular, was preceded by a sharp increase in the number of transactions deployed on the network.
SOL’s price rise on Aug. 8, in particular, was preceded by a sharp increase in the number of transactions deployed on the network, according to the data provided by Dune Analytics’ dashboard for Pump.fun.
The chart below shows that daily transactions on the Solana blockchain increased from 9,619 to 18,648 between Aug. 4 and Aug. 7.
The spike in onchain transactions on Solana indicates heightened network activity and growing adoption. More user interaction with the platform leads to increased transactions and network usage, driving demand for SOL and positively impacting its price.
Related: Solana’s first gaming SVM surpasses 1M monthly active users
SOL’s market structure hints at a return to $190
On the daily timeframe, SOL’s price action shows the token forming a V-shaped recovery pattern, as shown in the chart below. The 50-day exponential moving average (EMA) at $156 is acting as immediate support.
The relative strength index (RSI) is rising and has just crossed the 50 mark, asserting the buyers’ dominance in the market. The bulls now focus on the barrier at $180 and later the neckline of the prevailing chart pattern at $185.
A daily candlestick close above this level could confirm the continuation of the uptrend. The next logical move would be to the July 20 range high at $193, bringing SOL’s total gain to 21%.
On the downside, failure to hold above the 50-day EMA at $156 would signal the inability of the buyers to sustain the uptrend. If this happens, SOL could drop to seek solace from the 200-day EMA at $139 or lower to the pattern’s low at $110, invalidating the bullish outlook.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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