Analyzing the Pros and Cons of the Solana Network in 2022 Why Investors Should Consider a Different Strategy for SOL

Investor interest in Solana’s native cryptocurrency, SOL, has waned in recent months. This is not only because of the bearish market conditions, but also because of the down network incidents and FTX woes. While these factors have eroded interest in cryptocurrency, the current discount is quite attractive.

Read Solana’s (SOL) Price Forecast 2023-24

While SOL’s discounted price is enticing, there’s no getting around the denial of confidence. As a result, since June, the cryptocurrency has barely secured enough bullish momentum for a sizeable rally. This underscores why SOL may not be the ideal cryptocurrency for investors looking for a big price pump during the next bullish wave.

One factor fueling Solana’s initial hype in 2021 was hope that it would become an “Ethereum killer”. Fast forward to the present, and the result does not match expectations. However, it’s not all doom and gloom.

There is still hope for SOL

Solana certainly hasn’t fared well this year, but there are some aspects that highlight why the community remains hopeful. It has maintained healthy development activity and remains focused on long-term development.

Source: Sentiment

The development activity metric confirms that the network developers have been busy building. According to recent updates, some aspects of the network have seen positive growth since the beginning of the year. For example, the maximum number of transactions per second has grown since the beginning of the year.

Source: Dune analysis

The number of daily transactions is another area where Solana has achieved growth this year. There was healthy growth in the number of successful voting transactions. This confirms that the Solana community is more actively involved in governance related matters.

It also maintained remarkable levels of voting-related transactions throughout the year, confirming healthy network utility.

In particular, Solana’s NFT segment took a hit during the year, as reflected in the total number of NFT transactions and total NFT transaction volume. Despite this, Solana has maintained a significant amount of NFT trading activity.

Source: Sentiment

A change of tactics

The fact that Solana has grown in some aspects of its network is reassuring to investors. However, investors still need to consider the downsides and what this means for the network, as well as SOL’s price action.

Solana’s woes have already dampened the mood, but it is currently trading at a discount. Furthermore, the latest price action has confirmed that there is a return of rising demand.

Source: TradingView

While rising demand is a positive sign for investors, a different strategy may be needed. Adding it to a diversified portfolio certainly wouldn’t hurt, unlike going all in with SOL.

This post Solana enthusiasts should consider this before buying back at current levels

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