Why is Solana (SOL) price up today?

From cointelegraph by Nancy Lubale

Solana SOL$259.11price continues its recovery today, matching the upside moves elsewhere in the crypto market as BitcoinBTC$103,910trades above $105,000.

Data from Cointelegraph Markets Pro  and TradingView  shows that SOL’s price was $257, up more than 9% in the last 24 hours and 35% over the last seven days.

  SOL/USD daily chart. Cointelegraph/TradingView

Let’s discuss the key factors driving SOL’s price up today.

Increasing network activity backs SOL’s upside

The  Solana network  has been experiencing a significant uptick in activity, which strongly indicates its growing adoption and utility within the blockchain ecosystem. 

This surge in activity includes more transactions being processed, which enhances the network’s efficiency and attractiveness to developers and users alike. 

This can be attributed to the recent frenzy around the  Official TRUMP  (TRUMP) and  Official Melania Meme  (MELANIA) on Solana, which saw Solana’s price  rocket to all-time highs on Jan. 19 . 

The latest data from Dune reveals that the number of daily transactions on the  Solana blockchain  increased from 45,881 on Jan. 17 to Jan. 19 amid the memecoin frenzy, indicating an overall resurgence in network activity. 

  Solana’s deployed transactions chart. Source: Pump.Fun

Similarly, the  total value locked  (TVL) on Solana jumped to  an all-time high of $12 billion  on Jan. 20, according to data from DefiLlama. This value stands at $11.8 million on Jan. 22, up 212% over the last seven days.

  Total value locked on Solana. Source: DefiLlama

Buzz around spot Solana ETF approval

The anticipation around the  potential approval of a Solana ETF has significantly impacted its price.

With Polymarket users predicting a 92% chance of approval in 2025, this anticipation has fueled the ongoing SOL price rally.

Source: Polymarket

An ETF approval would provide a regulated investment vehicle for traditional investors, potentially increasing Solana’s exposure and legitimacy in the broader financial market.

Analysts at JPMorgan have  predicted  that a spot Solana ETF could attract between $3 billion and $6 billion in capital inflows.

This potential influx of capital can propel SOL’s price substantially higher toward or beyond the $500-$750 range, depending on market conditions and the scale of institutional inflows.

Several major asset managers have submitted applications for a  Solana ETF , including  VanEck ,  Grayscale ,  21Shares , Bitwise, and  Canary Capital .

Most recently, Bloomberg Senior ETF analyst James Seyffart  shared  a list of the current ETF filings before the US Securities and Exchange Commission (SEC), including a spot Solana ETF filing by REX Shares. 

Fellow analyst Eric Balchunas has  stated  that REX is not just a random issuer, noting that it is “rather an early pioneer in the industry, with decades of experience.”

The SEC is expected to make preliminary decisions on these applications before the end of January. Grayscale’s application faces a deadline on Jan. 23, with other applicants expecting decisions by Jan. 25.

Related:  Coinbase Solana transactions delayed amid memecoin frenzy

Solana price to $500?

Analysts and market experts have been forecasting a bullish future for Solana, with predictions suggesting significant price increases in the coming weeks.

Pseudonymous trader Momin believes Solana will continue its “legacy,” adding that calling out the Solana ecosystem last month when the price was below $200 was the “easier bet.”

“To be honest, I feel we see $500+ on $SOL this cycle!”

  Source: Momin

Fellow analyst Kolin  said  that the $500 target for SOL price is “conservative,” arguing that “Solana’s just warming up” and that it will move much higher once “ institutional money really starts flowing in.”

SOL’s technical setup hints at a rise to $500 and beyond, aligning with Kolin’s sentiments regarding the altcoin’s potential to move higher.

SOL price confirmed a  bull fag  chart pattern when it produced a decisive weekly candlestick close above the flag’s upper boundary at $180 in early November 2024.

Note that the price rebounded from this level during the week ending Jan. 13, suggesting the importance of this level to the bulls.

If the bulls sustain the momentum, the price will likely move higher toward the technical target of the prevailing chart pattern at  $580.

  SOL/USD weekly chart. Source: Cointelegraph/TradingView

The relative strength index at 62 shows that the market is not overheated, suggesting that there is still more room for upside.