Solana (SOL) was one of the most popular projects of the past bull market. But today, the network is receiving huge amounts of criticism. De SOL token like many other projects fell hard, and on-chain data suggests that all the criticism has had its impact.
A lot of criticism of Solana
The well-known Layer 1 network has been around 220 euros since the peak already dropped by almost 95% to about 13 euros. It had quite the wind this year, and not just because the price has fallen so hard. The network is also criticized for being far from decentralized. For example, a DeFi project on Solana wanted to take over a wallet with a huge amount of SOL tokens when another project ran into problems, but the community strongly opposed this.
Cloud provider Hetzner also no longer allows Solana nodes to run, the company simply wants nothing to do with crypto. 40% of Solana validators run on Hetzner. The US Department of Defense has concluded that Solana is one of the blockchains that is very centralized.
The problems with FTX have revealed even more problems. Alameda Research, which is related to FTX, was an important market maker for the Solana-based Solend, which was struggling with enormous liquidity problems. Many exchanges therefore no longer allow you to put stablecoins on Solana.
Solana much less popular
All of this seems to have quite an effect on investors, according to on-chain data. For example, sales of Non-Fungible Tokens (NFTs) on Solana have fallen by 48%, one of the largest declines in the industry. Out data from sanitation it turns out that Solana is not exactly popular anymore on social media either.
There is also a positive signal: developers have actually become more active. Fundamental developments like this could give investors a little more confidence. The lack of popularity could actually be a good thing, offering you an opportunity to buy at a time when no one is willing to buy.