SOL /BTC prediction: Can Solana arrest year-long decline, return to growth?
Solana’s SOL has been seeing a surge in investor interest as it continues to expand its network with more exciting projects coming up. Despite dipping by 87.8% since its all-time high in November 2021, experts are saying that a rebound is near while bitcoin (BTC) is down by around 70% since November 2021 gains.
How do the two coins trade against each other and what does the SOL to BTC forecast suggest amid a bear market? Let’s take a look at the SOL/BTC pair and some of the factors that may shape its exchange rate.
What is SOL/BTC?
SOL/BTC is the exchange rate between SOL, the native cryptocurrency of the Solana blockchain platform, and BTC, the native token of the Bitcoin Network.
Bitcoin was first mined in 2009 by its creator or group of creators who prefer to keep their identity a secret using the pseudonym Satoshi Nakamoto. It is also the first ever platform to use a blockchain to build, exchange, store and distribute the digital coin.
The cryptocurrency is used as a peer-to-peer payments method, and over the last 10 years it has also become an investment vehicle.
Bitcoin uses a Proof-of-Work (PoW) consensus mechanism. The cryptocurrency is given as a reward to miners who solve mathematical equations to prove the legitimacy of BTC transactions.
The maximum number of newly mined bitcoins is limited at 21 million. After every 210,000 mined BTC blocks (this takes around four years), the blockchain experiences a halving event, which cuts the number of BTC coins in circulation by half.
Solana is a public, open-source blockchain that hosts a number of projects in the likes of decentralised finance (DeFi) applications, non-fungible tokens (NFTs) and Web3.
It prides itself in its low transaction costs (at less than $0.01), fast speed (at 400 milliseconds per block) and security (it is censorship resistant). The blockchain was nicknamed the ‘Ethereum killer’, as it aims to improve what the Ethereum blockchain is lacking.
It was founded in 2017 by a former Qualcomm (QCOM) employee and Dropbox software engineer Anatoly Yakovenko and his colleague Greg Fitzgerald. In contrast to BTC, Solana uses a Proof of History (PoH) consensus mechanism for verifying transactions on the blockchain, which uses an alternative method for calculating time.
Some of the network’s key functions allow users to mint, sell and trade NFTs, create their own DeFi projects, write smart contracts, build Web3 games and accept payments in crypto form.
SOL coins are ERC-20 standard, meaning that they were developed on the Ethereum (ETH) network and are primarily used for interacting on the blockchain.
What is your sentiment on SOL/USD?
SOL to BTC price history
Since SOL’s launch in 2020, the SOL to BTC rate struggled to pick up momentum, moving sideways for around 10 months before starting to gain speed at the end of February 2021.
Between late February 2021 and mid-August 2021 the pairing fluctuated between values as low as 0.0001781BTC and as high as 0.001179BTC. The SOL to USD price chart followed a similar trend, fluctuating between $13 and $49.
Between 15 August 2021 and 9 September 2021, however, the SOL/BTC pair surged, rising by more than 385%, up from 0.0009374BTC to 0.004576BTC as Solana was being discovered by a number of celebrities, such as Mike Tyson and Jason Derulo. This was also the time when the SOL to BTC reached its all-time high, as seen on the price chart above.
Between 9 September 2021 and 20 October 2021 the SOL/BTC price lost nearly 50% of its gains, dropping to 0.002425BTC as the BTC price in US dollars started to see major gains, surging by around 39% within the period from $46,000 to $64,000.
In line with other major cryptocurrencies, the SOL/BTC rate regained a big portion of its losses as it rose to 0.004202BTC by 7 November 2021, at the time when the SOL value in USD reached its all-time high of $258.78.
Up until the start of January 2022, the SOL to BTC exchange rate was fluctuating between 0.004000BTC and 0.003000BTC before falling more than 60% to 0.001149BTC on 13 June 2022, amid overall broad negative investor sentiment.
In terms of technical analysis, the chief digital advisor at the Mongolian Productivity Organisation and author of NFT: From Zero to Hero, Anndy Lian, told Capital.com that the SOL price could be headed towards a trend reversal, as of 28 October.
“The Relative Strength Index (RSI) indicates that the token is in the overbought zone, signalling a reversal could be on the way,” he said.
The pairing’s current exchange rate (28 October) is 0.00151BTC, up by 31.4% since its 13 June 2022 dip.
What is driving SOL/BTC?
On 30 September 2022, the Solana Mainnet Beta cluster experienced an outage, which led to a temporary collapse in the blockchain. This saw the SOL to BTC exchange rate drop by 3.1% within a week, down to 0.001682BTC by 7 October 2022, from 0.001735BTC on the day of the outage.
Dr. Pooja Lekhi, professor of global financial institutions, risk management approach and financial management at University Canada West, told Capital.com:
Projects built on Solana have potential to affect the token’s future price. On 27 October, the Web3 platforms built on Solana Decentralised Engineering Corporation (DEC) and Teleport announced that they have raised funding to bring a Web3 Uber rival (TRIP) to the Solana blockchain, something Ethereum co-creator Vitalik Buterin theorised a while back.
Lian noted that bringing the ridesharing industry to the Solana ecosystem “would surely put SOL into a high utility mode”.
In addition, Solana had partnered with artist Nancy Baker Cahill. She launched her first NFT collection on the blockchain that was shown across 90 billboards on Times Square. Metaplex, an NFT ecosystem built on Solana, also announced it was bringing a new asset class that will allow “creators to enforce royalties at the protocol level by extending the Token Metadata program, which powers 99%+ of all NFTs on Solana.”
We’ve heard you - the community is ready. Metaplex is building a new asset class that will enable creators to enforce royalties at the protocol level by extending the Token Metadata program, which powers 99%+ of all NFTs on Solana.
— Metaplex (@metaplex) October 20, 2022
Dr. Lekhi noted that until Solana network’s upgrade, “stability will remain a major concern for the SOL, adding:
The date for the upgrade launch is yet to be announced.
The enthusiasm surrounding Solana also comes following the news about Saga, its flagship Android phone, which will start shipping in 2023, Lian noted. Solana announced that Saga will have its first mint event on 28 October, which will only be available to those who pre-ordered the phone.
SOL/BTC price prediction
Based on the analysis of past performance, as of 28 October, algorithm-based forecasting service Wallet Investor predicted that SOL/USD could fall to $2.947 in 2023. The platform did not provide a price prediction for 2027.
In terms of its BTC value forecast, the site saw BTC/USD trade at $23,107.27 in 2023 and reach $36,574.97 by 2027.
While Wallet Investor did not provide a direct SOL to BTC forecast, data suggested that the exchange rate could be 0.00012754BTC in 2023.
DigitalCoinPrice predicted that SOL/USD could rise to $36.55 by the end of 2022. The site’s data, as of 28 October, showed that the coin was expected to trade at $49.68 in 2023 and $80.94 in 2025. Its long-term prediction saw the coin reaching $169.10 in 2030.
The site also gave an upbeat BTC/USD forecast, as of 28 October, expecting the coin to grow to $25,646.42 by the end of 2022, reach $33,474.34 in 2023, $53,010.14 in 2025 and surpass $112,000 in 2030.
DigitalCoinPrice’s SOL to BTC forecast for 2022 expected the pair to reach 0.0014252BTC and 0.0014841BTC in 2023. The site’s SOL/BTC forecast for 2025 stood at 0.0015269BTC. Its long-term SOL/BTC forecast for 2030 was 0.0015098BTC.
Dr. Lekhi noted that 2022 was not a good year for SOL, however, the coin may observe a steady growth in the coming months as a rebound in SOL’s price is anticipated.
Lian added that interest in SOL is “extremely high” which could mean that its future movement could be “overall positive”, adding that “with the strong ecosystem backing its value, the rebound can be promising.”
Remember that analysts’ and algorithm-based predictions can be wrong and shouldn’t be used as a substitute for your own research.
Always conduct your own due diligence on a cryptocurrency project before trading, looking at the latest news, a wide range of analyst commentary and technical analysis. Note that past performance does not guarantee future returns. And never trade money you cannot afford to lose.
FAQs
Why has SOL to BTC been dropping?
In 2022, SOL fell lower than BTC, losing 82% of its value since the start of 2022 versus BTC’s 56.6% fall, as of 28 October. Consequently, the SOL/BTC rate dipped. Both tokens suffered amid negative market sentiment, surging inflation, the Fed’s aggressive monetary policy hikes and the collapse of the TerraUSD (UST) stablecoin which sent most cryptocurrencies into a bear market.
Will SOL to BTC go up or down?
As of 28 October, algorithm-based forecasting service Wallet Investor predicted that the exchange rate between SOL to BTC could be 0.00012754BTC in 2023. Meanwhile, DigitalCoinPrice’s SOL to BTC forecast for 2022 expected the pair to reach 0.0014252BTC and 0.0014841BTC in 2023. The site’s SOL/BTC forecast for 2025 stood at 0.0015269BTC. Its long-term SOL/BTC forecast for 2030 was 0.0015098BTC. Note algorithm-based forecasts can be wrong and shouldn’t be used as a substitute for your own research.
When is the best time to trade SOL to BTC?
Cryptocurrency markets are open 24/7, which means you can trade SOL/BTC at any time of day. Studying technical analysis and reading the latest news to shape your own market view could help you figure out which time works best for your trading strategy.
Is SOL to BTC a buy, sell or hold?
Whether SOL/BTC is buy, sell or a hold should depend on your trading strategy, risk tolerance and portfolio composition. You should do your own research, looking at the latest news, technical analysis, and analyst commentary before trading. Keep in mind that past performance is no guarantee of future returns. And never trade money that you cannot afford to lose.
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