Crypto trader Lark Davis says five fundamental factors are fueling the meteoric rise of the smart contracts platform Solana (SOL).
In a new video, Davis tells his 427,000 YouTube subscribers that SOL is exploding because developers are actually building on its blockchain.
“Builders are actually showing up… You got to have stuff built on your blockchain. Otherwise, you’re a ghost town. Solana is definitely not a ghost town. We have loads of applications built on Solana [that] you can actually go out [and] use right now, today…
For example, you have Port Finance (PORT). That’s one of Aave’s competitors that we’re seeing come up on Solana. We have Mercurial Finance. That’s like Ethereum’s Curve Finance. It’s a stablecoin-swapping protocol. We have Radium (RAY), which is like Uniswap (UNI).”
The rise of non-fungible tokens (NFTs) is also contributing to the growth of Solana, according to Davis.
“NFT has been a massive trend recently. Solana’s got a lot of NFTs, too. That’s been part of what has been driving the demand: to get the main Solana asset, the SOL token, because people want to go and buy NFTs on Solana, which are priced in Solana.”
Davis says Solana’s financial situation is also helping fuel the token’s rise. The company raised $314 million in June to bolster its decentralized finance (DeFi) ecosystem.
“Part of the reason we’re seeing so many developers committing to the SOL ecosystem right now – they’re getting money. They’re getting grants. They’re getting a lot of investments…
So it’s $314 million, plus the backing of FTX, which having a cryptocurrency exchange that big, that’s like [having] more money than God.”
Davis says that large financial institutions are also starting to take an interest in Solana.
“Institutional money is starting to take a interest in Solana. Osprey, they announced a Solana fund two weeks ago. They are far from the only big-money players piling into Solana right now.”
Davis also looks at the total value locked (TVL) in Solana’s ecosystem, which has exploded to over $5 billion. The Crypto trader predicts that Solana’s TVL will continue to grow as market participants seek to provide liquidity and generate yields without paying hundreds of dollars worth of transaction fees.
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