This increase followed a robust recovery in the price of SOL, Solana's native token, which rebounded strongly after a sharp drop. On August 5th, during a tumultuous day for global financial markets, SOL plummeted over 36%, hitting a low of $110. This decline also dragged down the market capitalization of memecoins on Solana by more than 16%, reducing it to $5.56 billion. Popular Solana-based memecoins such as Dogwifhat (WIF), Cats in a Dog’s World (MEW), and Book of Meme (BOME) experienced significant losses of 13%, 15%, and 16%, respectively.
However, in the two days following this steep sell-off, SOL staged an impressive recovery, climbing over 39% from its recent low to reach $154 by August 7, 2024.
In parallel, the market capitalization of memecoins across the Solana network saw a significant rise, surging over 30% within the last 24 hours.
One of the standout performers was POPCAT, a popular cat-themed memecoin, which saw a 36% increase. Similarly, Dogwifhat (WIF) rose by 27% over the past week, and other meme tokens like MUMU and CATDOG recorded gains of over 30%.
In contrast, leading memecoins on Ethereum, such as DOGE and PEPE, experienced only modest increases of 4.2% and 6.8%, respectively, indicating a shift in community focus towards the Solana ecosystem.
This FOMO-driven activity within the Solana ecosystem was also evident in its trading volume, which more than doubled, soaring to over $3.53 billion from $1.5 billion on August 5th. This surge in activity generated at least $750,000 in fees within the last 24 hours alone.
Notably, pump.fun, a well-known memecoin issuance platform, profited significantly from this uptrend, pocketing more than $535,000 in the past 24 hours, highlighting the growing strength of memecoin trading on Solana.
Given the increasing momentum on Solana, many analysts are speculating that SOL might soon be approved by the SEC for a spot ETF, potentially becoming the third cryptocurrency to achieve this status after Bitcoin and Ethereum.
Lucy Hu, an analyst at Metalpha, commented:
“The potential approval of a Solana ETF is a promising sign of SOL's broader acceptance. The rapid recovery of SOL reflects growing user confidence in Solana as the market stabilizes. Solana has demonstrated sustainable growth through continuous innovation, and the rising popularity of memecoins on this platform is further evidence of this trend.”
In early July, CBOE filed 19b-4 forms with the U.S. Securities and Exchange Commission (SEC), seeking to list prospective Solana spot ETFs from VanEck and 21Shares, which were initially submitted at the end of June.
