The SOL token reached a high in August, nearly doubling in price as investors hoped for “smart contract” blockchains to rival Ethereum in the future.
Using Messari and other sources, the SOL token’s price rose 195% in August to $108; the token now has a market value of $33.7 billion, making it the 10th most valuable cryptocurrency in the world. A staggering 62-fold increase in value occurred just this year.
Its market capitalization also rose to approximately $13 billion on August 1, thanks to a nearly threefold increase in the price of Terra’s LUNA token.
Top-performing digital assets among the CoinDesk 20 included Cardano’s cardano (ADA, 3.30%), which doubled in price, followed by Polkadot’s polkadot (DOT, -1.62%) that returned 75%.
These top performers in August were all people affiliated with so-called layer 1 blockchains that featured low fees, enhanced scalability and low transaction times designed for decentralized finance (DeFi) and non-fungible token trading.
There has been much speculation surrounding Ethereum 2.0, the second-largest blockchain in the world after bitcoin, which will undergo significant upgrades next year under the codename Ethereum 2.0.
“We have enormous respect for the Ethereum developer community’s spirit,” Solana Labs CEO Anatoly Yakovenko, told CoinDesk. “It’s been an inspiration to watch, and in many ways laid the blueprint for disintermediating all of the world’s marketplaces, starting with DeFi. We are in the same fight.”
The company also announced the launch of its global five-week Ignition Hackathon on Aug. 31, which will focus on Web 3.0 development, DeFi, gaming, and NFTs. An official for Solana said the rumor was unfounded and the Ignition event did not hint at a token burning.
As a result of its perceived scalability, low transaction costs and fast processing speed, Solana has garnered interest from investors including Andresseen Horowitz (a16z) and Polychain Capital. The company was founded by Yakovenko in 2017.
The Ethereum platform has the most active community of developers among smart-contract blockchains and DeFi activity, and the fastest-growing OpenSea NFT market is based on Ethereum. Although the network has been hampered by high fees and congestion.
“ETH has experienced growing transaction fees amid the NFT frenzy, possibly attracting more users to other chains,” according to a report by Arcane Research. “However, in the DeFi ecosystem overall, Ethereum remains the clear leader, and it seems unlikely that any other protocol will dethrone Ethereum’s position in the near future.”