Solana's [SOL] blockchain has been buzzing with activity, registering a sharp increase in decentralized exchange (DEX) volumes and token burns.
Solana’s [SOL] blockchain has been buzzing with activity lately. This activity was particularly evident in the realm of decentralized exchanges (DEX), where volumes surged to new heights.
Collectively, these DEX platforms, including Raydium [RAY] and Phoenix, processed over $10 billion in trades, according to data from Dune Analytics. This upswing in DEX activity signaled a heightened demand for Solana-based decentralized finance (DeFi) applications.
Solana’s native token, SOL, also saw a significant rise in demand. As activity on the network soared, the burning of SOL tokens played a crucial role in the network's economic model.
With 50% of transaction fees being subjected to this burning process, the supply of SOL in the market continued to dwindle, creating scarcity. Recent data from Dune Analytics indicated that Solana burned over $6 million in transaction fees, a record-breaking measure that showcased the network’s bustling activity.
This burning mechanism not only curtailed supply but also enhanced the perceived value of SOL. As activity intensified, so did the rate of burns, which ultimately contributed to a deflationary trend that benefited long-term holders. This reduced supply dynamic provided a strong tailwind for a token already gaining momentum.
Solana’s price continued to soar, reaching over $250 and nearing its yearly highs. An analysis by AMBCrypto highlighted a mix of signals, with the RSI indicating overbought conditions, suggesting a possible consolidation period, and the MACD remaining bullish.
The next major resistance level was situated at $275, a point that could either trigger a breakout or act as a barrier. A sustained rise in on-chain activity, coupled with steady DEX volumes and token burns, could provide the momentum needed to break this resistance.
However, failure to clear this level might cause SOL to retrace to key support at nearly $230.
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