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- Solana rebounded well in January, but the Bulls were unable to maintain the pressure
- Frequent network outages may spook investors
Despite all the turmoil Solana has experienced over the past six months, it remains one of the top 10 assets by market capitalization in the cryptocurrency space. This speaks volumes about the confidence investors and stockholders have in Solana, which has been dubbed the “Ethereum killer” by some of its enthusiastic users.
This was well reflected on the price charts. Heading into 2023, SOL has been hovering around the $10 support area. It was already in the grip of a downtrend that extended into November 2021, when SOL was trading at $200. Just as investors began anticipating more losses across the cryptocurrency market in January, Bitcoin started to climb past $17K and the short-term sentiment turned bullish.
Solana benefited greatly from this turnaround and posted a gain of 175% in 21 days. However, it was unable to break the resistance area between $26 and $28, which was the support from June to November 2022.
Read Solana’s [SOL] Price forecast 2023-24
The most bullish scenario for 2023, according to forecast bot AMBCrypto, could see SOL value at $75.5. However, we can ask another bot about the price, network health, and Solana’s path after giving it some relevant data points.
Can we get ChatGPT to predict Solana’s price if we give him enough information?
ChatGPT has been a great chatbot, and last month’s updates made ChatGPT 4.0 impressive. It is a powerful tool for learning and has been trained on a wide range of topics. However, it must be said that a bot is designed to mimic a human, and it doesn’t have to be factually accurate. The ChatGPT jailbreak version is likely to be inaccurate because it was specifically instructed not to say no to anything a user requests.
However, it is possible to get some guesses from the chatbot as to what the future might hold if given an idea of what the present and recent past were like.
So, what makes ChatGPT Solana? Do you see a way to recover after the recent setbacks? Based on transaction fees and transaction speeds, ChatGPT seems to believe Solana will be an Ethereum killer.
Source: OpenAI
We have yet to inform her of the challenges Solana and SOL investors have faced in recent months. Let’s start with the biggest impact on investor confidence –
FTX, where the free fall began
Sam Bankman-Fried has been one of the Solana Network’s most outspoken supporters. He was seen as a credible and shrewd investor and businessman who was the CEO of one of the largest cryptocurrency exchanges, FTX. Although Binance is dominant in terms of volume and token pairings, FTX has been giving it a run for its money. Competition is also good for the industry and serving customers.
A lot has changed since then, and the SEC charged Mr. Bankman-Fried with defrauding FTX equity investors, also alleging that he mixed FTX clients’ money with Alameda to make undisclosed investments. He faces more than 100 years in prison if convicted of all charges.
Not only did Solana’s reputation suffer, but the foundation also sold a large amount of SOL to FTX Trading and Alameda Research. This amounted to 58.08 million SOL, or 11% of the circulating supply at the time FTX filed for bankruptcy. It was valued at approximately $1.1 billion at the time.
As expected, the price of Solana fell in November and fell by 45% from November 11th to December 31st, from $18.08 to $8. With rumors of an FTX bankruptcy circulating from November 5, SOL had already lost 50% in the previous week, when it was trading near the $38 mark. This brought SOL’s total loss from November 5, 2022 to December 31, 2022 to 79.4%.
Source: OpenAI
ChatGPT certainly sounds optimistic, and early 2023 has gone very well for investors. However, some network issues have cropped up, just like in 2022.
SOL increased by 180% in January-February 2023, exceeding all expectations
From January 1st to February 20th, Solana increased by 179.88% on the price charts and went from $9.69 to $27.12. This explosive race is attributed in part to Bonk, a meme coin introduced within the Solana ecosystem similar to the Shiba Inu. A portion of the 99 trillion total supply in Solana users’ wallets was dropped in December. The number of transactions per day was on a downward trend in the second half of December, but this started to turn around in early January.
Is your wallet green? Check out Solana’s Earnings Calculator
Soon after, transactions started accelerating again. It was reported that the introduction of the fun meme coin did a lot to distance the community from the dark, gloomy shadow that the FTX debacle had cast on Solana.
When fed in on-chain data as well as price action in recent months, the cracked version of ChatGPT was able to muster an opinion on Solana’s performance in Q2 2023.
Source: OpenAI
The network has faced annoying outages in recent months, and investor confidence is likely to be severely shaken. Chat bot approved.
Source: OpenAI
When made to guess about Solana’s price in June, she said,
Source: OpenAI
The $25 prediction might not be too far from the mark in the coming weeks, especially if bitcoin bulls can push BTC above the $29.2k mark. Predictions and guesswork aside, what does price analysis tell us about Solana?
There are still some imbalances to the south but the $20 level could be weaker than expected
Source: SOL/USDT on TradingView
The daily chart showed that Solana was trading in a range through the latter half of January through February. This particular orange range runs from $20.4 to $26.6. Ultimately, SOL was forced below the lows of the range to reach the $16 mark on March 10th. However, it has recovered above $20 a week after that.
In April, the RSI remained pegged at the neutral 50 mark and showed momentum that did not favor either the bulls or the bears. OBV has also been flat over the past two weeks, again confirming neutrality. Therefore, traders can wait for a strong shift in sentiment and a breakout beyond $22 before buying.
Further north, the $25 target that ChatGPT set was within easy reach of the SOL bulls. However, Bitcoin traded below the $29K resistance area, and BTC’s rejection could trigger a sell-off across the cryptocurrency market. On other fronts, Solana still has the potential to remain a force to contend with in the crypto space.
Despite the massive setbacks, development on multiple fronts such as Solana Saga, the NFT market, and partnerships continued without catching attention. In hindsight, the past few months could turn into massive New Year’s sales on SOL. However, investors should temper their expectations as the cryptocurrency bull market is not yet in sight.