- Solana’s price has surged by approximately 600% against Ethereum since 2023, driven by the memecoin mania and increased usage of decentralized exchanges (DEXs) on its platform.
- The possibility of a “flippening” where Solana surpasses Ethereum in market capitalization has been speculated, but Solana needs to expand its user base beyond speculative traders and attract DeFi enthusiasts, traditional finance institutions, and enterprises.
- However, Solana’s technicals are looking extremely overvalued against Ethereum, suggesting a high possibility of a correction ahead, with the potential for a 40-50% decline by early 2025.
Solana (SOL) has seen its price surge over 600% against Ethereum (ETH) since early 2023, propelled higher by the recent memecoin mania. The so-called “flippening” – where Solana overtakes Ethereum in market capitalization – could become more likely if this trend continues.
Solana’s Meteoric Price Rise
The SOL/ETH trading pair climbed to a new all-time high of around 0.0692 ETH in late October. This forms part of an ongoing bull run that has seen SOL gain around 600% against ETH since the start of 2023.
At the heart of Solana’s rally is a massive increase in decentralized exchange (DEX) volumes on the network. Solana’s daily DEX volumes have trended higher since August 2021, occasionally matching or exceeding Ethereum’s volumes during peak periods.
Lower fees and faster transaction speeds have made Solana an attractive base for new token projects, especially memecoins which have exploded in popularity in recent months. The memecoin sector now makes up a large share of overall trading activity on Solana.
Solana’s Path to Flip Ethereum
For Solana to flip Ethereum, its market cap would need to surge over 35x from current levels to reach ETH’s $304 billion valuation. While a flippening once seemed unlikely, some analysts believe it could reach 50% of Ethereum’s value in coming years if user and transaction growth continues to accelerate.
Upcoming network upgrades like 2025’s Firedancer could further boost Solana’s appeal by enabling it to process up to 1 million transactions per second. If Solana can attract more decentralized finance users, institutions, and enterprises through upgrades like this, surpassing Ethereum may become more feasible.
www.msn.com
Warning Signs Emerge
However, Solana is looking extremely overbought against Ethereum on weekly timeframes. Indicators like the relative strength index (RSI) and bearish divergence signals hint that a major pullback may be ahead in 2025.
If the bullish momentum fades, the SOL/ETH pair could potentially drop 40-50% to the 0.0357-0.0436 ETH range. While Solana’s future looks bright, technicals suggest the rapid price surge against Ethereum is overextended and could soon reverse.
