Analyst Predicts SOL to Hit $3800, But On-Chain Metrics Tell Different Story

• Solana (SOL) transaction count grows from 889.7M to 2.6B, but daily active users drop to 3.1M.
• The declining developer count and network fees suggest challenges for sustained growth.

Solana (SOL) has been trading in the bearish momentum for a while. Currently, it is trading below key moving averages on a daily time frame, indicating bearish signals. However, despite the bearish sentiments, experts and the community are positive about SOL.

Renowned Bitcoin analyst, Ali Martinez, said in his latest X post that Sol could reach the $3,800 mark. He describes that Solana is shaping up into a cup-and-handle pattern. If this pattern is confirmed, the setup could propel the SOL towards the $3,800 level. 

However, looking at the weekly time frame, the SOL price is witnessing bearishness. The price already broke below the 50-day EMA mark and is heading towards the 200-day EMA mark.

According to CoinMarketCap data, currently, Solana is trading at $125.85 with an intraday decline of 1.62%, indicating mild bearishness. The daily trading volume has decreased by 30.49%, and the volume-to-market ratio is 4.03%. Moreover, the SOL market cap is $63.98 billion, and the 24-hour trading volume is $2.51 billion.

What Does Solana (SOL) On-Chain Analysis Indicate?

According to Tokenterminal, an on-chain analysis platform, the transaction count on the Solana blockchain is increasing. Over a year, transactions increased from 889.7 million to 2.6 billion, showcasing network growth. However, the daily active users have decreased in recent months. In November 2024, the daily active users count hit a high of 6.4 million; from there, it dropped and is currently at 3.1 million. 

Besides this, the fees and core developers count are also on the decline. The core developers are reduced from 86 to 24. The decline suggests the waning developer interest in the network. Moreover, the network fees are also declining, indicating reduced network usage.

The on-chain analysis indicates the decreased growth of the Solana blockchain. This decreased growth could be the result of increased competition from other blockchains. If this trend resumes, SOL may face challenges in network growth.

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