Some Solana ecosystem tokens and meme coins are gaining value from SOL’s 110% rally over the past month, a sign of rising bullish expectations for the blockchain among investors.
Bonk (BONK), a Solana token that began life as a meme coin in January, has surged 66% over the past 24 hours to extend a week-long rally to over 170%, data shows. Trading volumes and market capitalization have nearly tripled in a weekly period.
Such a resurgence indicates new money flowing into the Solana blockchain, especially among risk-on traders. Value locked on Solana ecosystem projects has increased to $465 million on Thursday from $300 million at the start of October, suggesting a boost in fund allocations toward decentralized applications built on the network.
At the start of November, developers introduced single-sided staking on bonk liquidity pools – allowing traders to earn yields of over 25% annualized by supplying bonk tokens to the Bonk Inu platform, which may have contributed towards improved sentiment.
Bonk took center stage in the Solana ecosystem in January as sentiment around the blockchain network hit in the aftermath of the Sam Bankman-Fried and FTX exchange debacle.
The tokens ran up as much as 3,200% in just three weeks after issuance, almost single-handedly inciting activity in the Solana ecosystem at the time, as previously reported.
Meanwhile, SOL has emerged as one of the top-performing crypto majors this year in a sign of the market shaking off the network’s purported closeness to crypto exchange FTX’s founder Sam Bankman-Fried, who has since faced criminal charges and has been pronounced guilty on seven charges of fraud.
Bankman-Fried was one of the top proponents of the Solana ecosystem during his active reign. He invested millions of dollars in Solana’s SOL tokens and across the Solana ecosystem and even launched the decentralized exchange Serum atop the network.
However, Bankman-Fried’s downfall seemed to kickstart a downward spiral in Solana tokens and ecosystem projects as investors considered the one-time crypto titan’s arrest a major headwind for the network.
FTX was an early investor in Solana and regularly received a significant volume of SOL unlocked according to a planned vesting schedule. It held over $1.16 billion worth of the tokens as of September 2023, as per a court filing, fuelling fears of selling pressure as the tokens are made available.
But recent actions by the bankruptcy committee overseeing FTX have seemingly buoyed sentiment. The committee staked over 5.5 million SOL, worth $122 million at the time, on the Solana network in mid-October, temporarily dampening fears of a sell-off.
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