Solana Network Activity Plummets 50%: Is the Recent Rally on Shaky Ground?
Solana Volatility Spikes Amidst Crypto Market Uncertainty
Analyzing Solana’s Divergence: Price vs. Network Activity
Solana is experiencing notable volatility as the broader cryptocurrency market navigates through increasing uncertainty. While some industry analysts anticipate a significant movement across the market, others remain cautious, specifically highlighting Bitcoin’s current challenges in breaking through price discovery as a potential obstacle.
Recently, Solana has seen a strong rally, but signs of divergence between its price action and underlying network activity have emerged. According to a report by Crypto Onchain, a CryptoQuant analyst, Solana’s on-chain data reveals a negative divergence between its price and network transaction volume. This indicates that despite the climbing prices, there’s a substantial drop in network transactions, raising concerns about the sustainability of this rally.
Solana’s Transaction Volume: A Closer Look
Despite Solana’s strong price rally, data from CryptoQuant shows a steep decline in transactional activity within its network. Daily transactions have plummeted from roughly 125 million on July 24, 2025, to around 64 million currently — a decrease of nearly 50%.
This decline is noteworthy as it coincides with SOL’s upward price momentum, creating a negative divergence that serves as a cautionary signal. Typically, healthy price appreciation should be mirrored by increased real ecosystem usage, encompassing more DeFi activity, NFT transactions, and user transfers. Analysis suggests that Solana’s rally could be driven more by speculative trading than organic network demand.
- Solana’s network activities have shown decreased transactional volumes.
- The decline creates a divergence between price growth and network fundamentals.
- Speculative enthusiasm, rather than actual demand, seems to be fueling the current rally.
Understanding the Decline in Solana’s Network Activity
To fully grasp the implications of this activity decline, it’s essential to identify which transactions are falling. Historically, around 80-90% of Solana’s network activity comprises “voting” transactions, which are crucial for maintaining network consensus. Therefore, a decrease here doesn’t necessarily imply a reduction in user engagement.
However, if the decline involves DeFi and NFT interactions, it could point to weakening fundamentals behind the Solana price surge. Analysts are keenly monitoring this trend to determine if it’s a mere technical adjustment or an early warning of speculative overheating. If the trend of declining user-driven activity persists, Solana might be at an increased risk of a deeper correction, challenging the sustainability of its recent price gains.
Price Analysis: Solana’s Road to Stabilization
Solana (SOL) is currently in a consolidation phase after an extensive rally that saw its price surpass the $240 mark earlier this month. The asset is presently trading near $221, marking a 3.5% daily decrease.
Despite this pullback, Solana maintains a bullish market structure, trading above its crucial 50-day, 100-day, and 200-day moving averages. These upward-trending averages indicate that momentum remains favorable for bullish investors.
| Price Level | Analysis |
|---|---|
| $210–$215 | This is the immediate support area, with the 50-day moving average. Staying above this level could signal a potential continuation of the rally. |
| $240–$250 | A breakout above these levels might pave the way to $280, where Solana encountered resistance in late 2024. |
| $190 | Falling below $210 could initiate a deeper correction, with downside targets around this price. |
Overall, Solana appears to be finding stability after its recent surge. Maintaining support above the 50-day moving average is critical for sustaining bullish momentum as the market looks for signs of its next major move.
