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Solana Overtakes XRP to Become Fifth Largest Crypto
Solana (SOL) has surged up the crypto market cap charts, officially overtaking XRP to become the fifth-largest cryptocurrency project.
SOL now has a market cap of $28 billion after gaining 13% over the past week. Meanwhile, XRP has stagnated around a $17 billion market cap amid ongoing legal headwinds.
Solana’s ascent reflects the rapid development happening across its burgeoning ecosystem. From red-hot NFTs to airdrops and phone launches, Solana is cementing its status as a leader in crypto innovation.
SOL Price Sustains Above $76 With Room to Run
The SOL token has climbed above the key $75 resistance level repeatedly over the past month. It now appears to have flipped this zone into support.
SOL is trading around $77 currently and has potential room to retest its all-time high above $260 if momentum continues building. This would represent massive 200% gains from today’s prices.
Driving this bullish outlook are on-chain and social metrics that indicate growing activity and interest in the Solana ecosystem.
According to Santiment data, SOL saw spikes in trading volumes between October and December as prices began rallying. Volumes have trended higher suggesting an influx of new users and capital into Solana.
Additionally, Solana’s social dominance is nearing its highest levels over the past six months. The chatter is driven by excitement around SOL airdrops, NFTs, and new smartphone launches.
“Increased on-chain transfers and discussions reflect genuine project growth, not just speculation,” said market analyst Anjali Lyons. “This organic adoption is the ideal backdrop for a sustained rally.”
Red-Hot Projects Building on Solana
A key factor fueling Solana’s rise is the surging development of its high-speed blockchain. From NFTs to GameFi and mobile devices, the Solana ecosystem is buzzing with activity.
Solana Mobile Phone
Crypto-focused smartphone Saga launched on Solana, offering built-in hard wallets and Web3 functionality. The phone sold out in just 30 minutes, underlining the demand for mobile DeFi access.
StepN GMT Token
The fitness app StepN built on Solana has been a smash hit, with its GMT token surging into the top 50 cryptos by market cap. Users earn GMT for walking and jogging outdoors.
Phantom Wallet
Phantom is now the most popular crypto wallet on Solana with over 2 million users. It makes asset management easy on both desktop and mobile.
Star Atlas GameFi
The highly ambitious Star Atlas metaverse and GameFi project continues rapid development on Solana after raising $26 million from investors.
This flurry of projects targeting mainstream users is quickly expanding Solana’s reach beyond just crypto natives. As Web3 goes global, Solana is emerging as the blockchain of choice for many developers.
“You can’t deny the thriving ecosystem being built on Solana,” said industry analyst Shella Okere. “It’s scaling faster than any chain outside of Ethereum.”
Advantages Over Ethereum and Cardano Attracting Developers
As an Ethereum competitor, Solana touts vastly greater speed and lower costs that make it ideal for NFTs, DeFi, and gaming.
Solana currently processes over 2,500 transactions per second (TPS) with 400ms block times. Meanwhile, Ethereum is still working on its scaling upgrades to reach just 100 TPS.
These performance advantages have attracted mainstream brands like Adidas, Lamborghini, and major NFT marketplaces to launch on Solana.
Cardano offers similar advantages over Ethereum but lags Solana in developer activity and real-world usage. Solana’s first mover advantage has given it a formidable lead in DeFi with $1.2 billion in total value locked.
“Solana’s technical architecture and early embrace of DeFi was a masterstroke,” commented Web3 Capital analyst Davis Stokes. “It will likely become the Visa payment layer of blockchain.”
Of course, critics argue Solana is far too centralized and suffers stability issues. But its market adoption shows users are willing to overlook these concerns for usability, speed, and costs.
XRP Declines as Lawsuit Clouds Future Prospects
Solana surging up the crypto ranks directly corresponded with XRP losing ground and market cap. XRP declined from about $22 billion to $17 billion market cap in December.
While Ripple notched some wins in its long-running SEC lawsuit in 2022, significant risks remain that continue to limit the upside. XRP faces delisting from major exchanges if Ripple loses at trial, which would crush its liquidity.
Moreover, Ripple’s extensive sales of XRP to fund operations rankle many in crypto who argue it should be considered an unregistered security. These concerns have made banks hesitant to adopt XRP.
Of course, a favourable settlement could quickly reverse XRP’s fortunes and reignite its utility within global payments. But until legal clarity arrives, uncertainty will lead investors to favour Solana and other protocols.
“We’re seeing money flow out of XRP and into assets with clearer growth runways like Solana as the lawsuit drags on,” shared Joseph Parker of blockchain firm ZenLedger.
For now, Solana continues riding a wave of developer momentum and user growth amidst broad blockchain adoption. Its SOL token appears poised to reach new highs as real-world utility drives lasting demand.
FAQs on Solana Overtaking XRP as 5th Largest Crypto
Q: Why did Solana’s market cap surpass XRP?
A: Solana is seeing surging development, usage, and demand around its DeFi ecosystem while Ripple/XRP is clouded by lawsuit risks.
Q: How much has Solana gained during its price rally?
A: SOL is up 13% for the week and over 200% from summer lows. It has the potential to reach its $260 ATH again.
Q: What projects are propelling Solana’s growth?
A: Red-hot apps like StepN Fitness, Star Atlas gaming, Phantom wallet, and the new Saga smartphone underlie its adoption.
Q: What are Solana’s main advantages over Ethereum?
A: Much greater speeds (2500+ TPS vs. 15 TPS), 400ms block times, and negligible gas fees make Solana superior for DeFi and NFTs.
Q: Where can I buy SOL tokens?
A: Major exchanges like Coinbase, Binance, FTX, and Gate.io all offer SOL/USD trading pairs to purchase SOL.
Q: Will XRP regain its spot over Solana if Ripple prevails legally?
A: Yes, clarity on XRP’s status and resumption of trading could revive its liquidity and market cap. But the lawsuit outcome remains highly uncertain.
Q: Is Solana’s blockchain network sufficiently decentralized?
A: Critics argue it’s too centralized. But Solana prioritized usability, speed, and costs to gain adoption and can decentralize more over time.
Conclusion
Solana’s SOL token has seen tremendous growth recently, surpassing XRP’s market cap to become the 5th largest cryptocurrency. This reflects Solana’s booming DeFi ecosystem and real-world adoption. With fast speeds, low fees, and surging projects, Solana appears poised for additional exponential growth in 2024. The SOL price could potentially double or triple from its current levels if momentum continues. While risks remain, Solana’s powerful technical architecture and first-mover advantage in DeFi make it one of the most promising blockchains outside Ethereum. As Web3 goes mainstream, Solana looks ready to emerge as a leading layer-1 solution for developers.
Disclaimer:
The content provided does not constitute financial advice. No guarantees of profitability are made. The author has no investment in Solana or XRP. Please conduct full due diligence before making financial commitments. CryptoWini will not accept liability for any losses sustained from investing in volatile crypto assets like SOL based on this article.
