Solana (SOL) Overtakes LUNA To Become 8th-Largest Cryptocurrency
Solana (SOL), the native token of the eponymous blockchain, recently overtook Terra’s LUNA to reclaim its spot as the eighth-largest crypto token by market capitalization. The rally comes on a string on positive news that drove demand for the token through last week.
SOL, which is the most staked token in the market, jumped 21% in the last seven days, and was trading near a two-month high of $110. It currently sits at a market capitalization of $35.9 billion, having recently surpassed the $33 billion of LUNA. The move comes only about two months after LUNA had surpassed SOL in market capitalization- although a major factor in this was also because of losses in SOL.
LUNA lagged its peers through last week, and was trading at levels seen last Monday. But the token has also benefited greatly this year from the growing popularity of the stablecoin TerraUSD (UST).
Gaming partnership, institutional interest boost SOL
Krafton, the South Korean developer behind the wildly popular videogame PUBG, last week said it was collaborating with Solana Labs to develop blockchain games and even a metaverse. The developer cited Solana’s feature to host highly scalable applications as one of the key drivers behind the deal.
Digital asset manager CoinShares, and world no. 3 crypto exchange FTX entered a partnership last week to launch a physically-backed Solana exchange traded product (ETP) for European investors, which allows traders to access SOL staking rewards without directly investing in the token.
The ETP will launch with 1 million SOL ($100 million) in seed capital. The product caters largely to the institutional market, which has become a major driver of crypto prices in recent years.
Additionally, SOL also makes up nearly a quarter of weightage in a recently launched smart contracts fund from digital assets manager Grayscale. The move is also expected to boost institutional investment in the token.
Broader crypto sentiment also improves
The broader crypto market has also been enjoying a boom in interest over the last week. Total crypto market capitalization jumped 12% to trade above the $2 trillion mark for the first time since February.
Gains in top altcoin Ethereum (ETH), driven by the ETH chain’s impending switch to a proof-of-stake (PoS) model, have spilled over into most other popular projects. The switch has also drawn attention to several other PoS tokens, benefiting SOL.
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