Solana (SOL) is facing challenges as it loses its grip on the memecoin market, marked by a 2% decline over the past week.
CoinShares data reveals that while Bitcoin and Ethereum saw inflows of $42 million and $4.2 million, respectively, Solana experienced record outflows of $39 million.
This downturn comes amid a sharp decline in meme token trading volumes on the Solana blockchain—a space where it had previously reigned supreme.
Solana’s decline and the rise of Tron’s SunPump
Solana’s recent struggles are evident in the bearish performance of its top meme tokens—WIF, BONK, BOME, and POPOCAT—all of which have plummeted by up to 30% in the last seven days.
This downturn coincides with the launch of Tron’s SunPump, a new meme token generator that is rapidly challenging Solana’s dominance in the meme coin sector.
Tron DAO’s SunPump, spearheaded by founder Justin Sun, aims to capture the meme coin market that Solana has historically led.
The platform has already gained significant traction, attracting 10,000 users within its first week.
Sun is optimistic about the platform’s potential, expecting user numbers to double soon and predicting a surge of meme tokens on top centralized exchanges like Poloniex and HTX.
SOL’s current price action
At the time of writing, Solana is trading at $143.01, following a 2.01% dip in the last 24 hours. The altcoin shows signs of weakness, and market analysts suggest that further declines could be on the horizon.
SOL 1D Chart on Coinmarketcap
Crypto analyst Ali highlighted a sell signal on Solana’s 4-hour chart, indicating potential price drops.
This sentiment is echoed by Santiment, which reports a significant dip in Solana’s weighted sentiment, reflecting growing negative sentiment in the market.
Additionally, Coinglass data shows a sharp decline in Solana’s long-short ratio, further supporting the bearish outlook.
However, there is still some room for optimism. Solana’s funding rate has plummeted, and prices often move inversely to funding rates, suggesting a possible bullish reversal.
If Solana can break through its 20-day Simple Moving Average, it could see a resurgence, potentially reaching $163 and, with continued momentum, hitting $186 or even $200.
The competition between Solana and Tron’s SunPump is intensifying, with market participants closely watching how these dynamics will play out.
If Tron’s SunPump continues to gain traction, it could dethrone Solana’s PumpFun and take over the meme coin industry.
As the market evolves, the outcome of this rivalry will likely shape the future of meme coins and the broader crypto ecosystem.
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