Solana’s network engagement has dropped sharply, leading to a significant decline in its total value locked (TVL). As a result, SOL’s price continues to slide, with weak demand threatening further losses.
User Engagement Drops, Impacting Network Growth
In the past month, the number of daily active addresses on Solana has fallen by 35%, according to Artemis. Only 4.08 million addresses interacted with the Layer-1 network in the last 30 days.
A drop in daily active addresses signals weak user adoption, declining investor interest, and a potential migration to other blockchains. This shift has also reduced transaction volume, with daily transactions decreasing by 18%.
Solana’s DeFi Ecosystem Feels the Pressure
As network participation slows, Solana’s DeFi liquidity is drying up. The blockchain’s TVL now stands at $6.69 billion, its lowest point since the start of the year.
A declining TVL indicates low investor confidence, as users withdraw funds from DeFi protocols. This weakens the network’s liquidity and adds selling pressure on SOL.
SOL Price at Risk of Dropping Below $120
SOL’s price is struggling amid weak demand. Currently trading at $124.86, the altcoin has dropped 35% in the past month.
The Relative Strength Index (RSI) sits at 36.91, signaling low demand. If selling pressure continues, SOL could fall to $120.72. A further breakdown might send it toward $108.43.
However, if market sentiment shifts positively, SOL could bounce back to $136.62.
