Solana is one of the leading competitors against Ethereum. This is especially known to Solana, being referred to by some as the “Ethereum killerâ€.
Part of the buzz that surrounded Solana and contributed to its explosive price growth in 2021 (a staggering 12,000%) was the sheer speed at which the chain handles transactions and its relatively low transaction fees.
Solana had a market cap of about $66 billion at one time, making it the fifth largest cryptocurrency.
Despite the popularity of this “wonder blockchain,†there was no escaping the bloodbath that has affected the price of most cryptocurrencies for almost a year now. In 2022, this network, with a market cap of almost $66 billion, has less than $12 billion and is now ranked 9th by market cap on the list of cryptocurrencies.
Problems with Mainstream Adoption
Asides from the hurdles Solana has to scale in terms of price, Anatoly Yakovenko, the co-founder of Solana, has pointed out a problem the network has on its way to mainstream adoption, like the other cryptos in the market.
According to Yakovenko, this problem or hurdle the network (and all the others) has to scale is the issue of self-custody.
While the whole idea of blockchain and cryptocurrencies is centered around the idea of decentralization and freedom of the users to own crypto and data completely, it is also one of the problems cryptocurrencies face.
Because not only Solana, but crypto in general, offers the freedom that comes with permissionless money. At the same time, crypto comes bundled with several issues relating to safe storage or self-custody.
Why Is Self-Custody a Problem
Self-custody, in a nutshell, refers to a situation where someone who owns cryptocurrencies also owns access to their private keys, either using hot wallets or hardware wallets.
Decentralization is the whole point of cryptocurrencies. It may be easy to ask why many users decide to leave their cryptocurrencies on centralized exchanges. If we asked this question, the answer would be simple.
Storing one’s own private keys can be a difficult thing to do.
According to Yakovenko, mainstream adoption of cryptocurrencies will continue to be a hurdle as long as no viable solution to the problem of storing one’s private keys exists.
Solana Price Analysis
Solana was trading inside an ascending channel from mid-June to mid august. After a breakdown of the lower support, however, the price of Solana hit the $29.2 support.
The price of Solana has been in consolidation since then and is trending sideways in what appears to be the beginning of a new ascending channel.
The RSI on the 4-hour chart shows neutral conditions, supporting the idea that Solana is currently in consolidation over the medium term. Solana might start a new and clear trend in the coming weeks and stick to it pending a subsequent breakout.
Disclaimer: The author’s comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)
