Expanding ecosystem and $ 1.86 billion futures open interest in Solana’s $ 250 goal

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Solana’s (SOL) price is again meeting resistance near its all-time high, but strong fundamentals and impressive growth in its decentralized finance (DeFi) and non-fungible token (NFT) ecosystem should push altcoin to the next level. over $ 250 prior to the year. to finish.

SOL / USDT 1 day chart. Source: TradingView

Interest from institutional investors is probably a key factor behind Solana’s impressive 490% gain since August. For example, SOL is the fourth largest component of the Bitwise 10 Crypto Index Fund ($ BITW), which is an overall $ 1.3 billion OTC market instrument.

Traders should remember that this event is not necessarily positive since futures contracts require both a long (long) and a short (short). However, the growing interest allows even bigger players to participate.

DeFi is gaining ground

Solana’s two most important decentralized finance projects are decentralized exchanges with built-in yield generation programs and they each hold a total locked-in value of nearly $ 2 billion.

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Saber (SBR) is an automated market maker (AMM) protocol that trades between stable pairs and synthetic assets and provides returns to the platform’s liquidity providers. Meanwhile, Raydium offers decentralized exchange, yield farming, and liquidity pools.

Proof of institutional investor appetite for Solana was the weekly inflow of $ 12 million in mid-October, as CoinShares recently reported. In the same week, the US-registered branch of the FTX exchange announced support for the Solana blockchain, allowing users to trade, deposit and withdraw NFTs that comply with the Metaplex token standard.

SOL Futures Open Interest Hits Record High

This positive flow of information was reflected in Solana’s derivative markets, as shown in the aggregate data on open forward interest rates below:

Futures contracts on Solana combine open interest. Source: Bybt.com

The indicator hit a record high of $ 1.86 billion on October 25, an increase of 123% in 30 days. To put it in perspective, Cardano (ADA) and Polkadot (DOT) currently hold an open term interest of $ 900 million.

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Traders should recognize that this event is not necessarily positive since futures contracts require both a buy (long) and a seller (short). However, this growing interest allows even larger players to participate.

Another positive factor is that DeFi protocols maintain a Total Locked-In Value (TVL) of $ 13.5 billion, even though the industry suffered a severe blow after the 5 p.m. network outage on September 14 and 15.

Total value blocked (TVL) on Solana in USD. Source: Defillama.com

The Solana Foundation said bots spammed the network when Grape launched its IDO on the Solana-based Raydium decentralized exchange (DEX). This activity exceeded processing capacity with a transaction load of 400,000 per second, requiring a hard fork coordinated by validators to ignore spam requests.

$ 250 seems closer than ever for SOL

TUSEN Markets Pro’s VORTECS ™ data also started to detect a bullish outlook for SOL on October 20, nearly 24 hours ahead of the 15% pump that led to $ 210.

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The VORTECS ™ score, exclusive to TUSEN, is an algorithmic comparison of historical and current market conditions derived from a combination of data points, including market sentiment, trade volume, recent price movements and activity Twitter.

VORTECS ™ score compared to the SOL price (white). Source: TUSEN Markets Pro

Data shows that the current number of tweets from unique accounts discussing Solana is 32% higher than the 30-day average. The volume of tweets is a component of the VORTECS ™ score which identified the bullish conditions for SOL on October 20.

As long as the Solana ecosystem grows, the network remains a viable solution for DeFi and NFT applications looking for economical and fast transactions. Onchain and derivative indicators signal that SOL $ 250 by the end of the year is quite achievable.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of TUSEN. Every investment and trade move involves risk. You should do your own research before making a decision.