The proliferation of NFT markets has ratcheted up the intensity of the competition. The Solana NFT ecology may be affected by market developments that are either more recent or more prevalent.
Throughout the first week of February, the amount of persons utilizing the Solana NFT marketplace daily has been shown to have been rapidly declining by the data that Dune Analytics provided.
A significant amount of money has been made in the NFT company, indicating that the market is growing exponentially. Despite this, the market size for non-fungible tokens (NFTs) rapidly rose during the first three months of 2021, reaching over $2 billion.
Is the Solana NFT Ecosystem Losing Steam?
Despite this, Solana's NFT marketplace has a significant amount of ground to make up before it can even be considered competitive, let alone slightly relevant.
The network, just like the rest of the market, has been exhibiting signs of declining performance. The fact that prices for SOL have been consistent at about $22.3 indicates that the level of buying pressure is beginning to relax.
The crypto market cap tracker Coingecko reports that SOL's value has decreased by around 3% over the previous twenty-four hours. From this point forward, you should expect the selling pressure on the market to increase even further.
The capitalization of SOL, currently at $8.44 billion, is expected to continue increasing if the stock can break above the resistance level of $23.20 and then break above the barrier level of $24.75, according to the opinions of analysts.
What Kind Of Effect Will This Have On The Pricing Of SOL?
Since the 13th of February, the price of SOL has climbed by 24%, and the explosion in the price of SOL has continued unabated even though user activity on the Solana blockchain has decreased. The value of the cryptocurrency has climbed by 163% from the start of 2023.
As a result of recent optimistic occurrences within its ecosystem, SOL may add to the gains it made in 2023 and see greater expansion in the first quarter of this year.
As can be seen in a graphic given by Santiment, both the number of overall NFT trades and the volume of those trades have declined over the previous 30 days on Solana. This decline reflects the decline in daily active users on Solana.
Lower Funding Rates
Similarly, looking at the data for SOL's on-chain transactions found even more grounds for concern. For the past few days, financing rates have decreased on Binance and DyDx, crypto exchanges where SOL is listed.
The decelerating pace of activity in the futures market can be inferred from the declining demand. In addition, the amount of development work done on SOL has decreased over the past week, which is unfavorable information for the network.