Signs Suggest Solana [SOL] Could Be Near a Market Bottom Amid Rising Transaction Activity

• Recent indicators reveal a mixed sentiment around Solana (SOL), suggesting a potential market bottom amidst a resurgence in on-chain activity.

• Despite challenges in Q1 2025, the increasing transaction volumes point to a recovering network, which may be an inviting opportunity for investors.

• According to COINOTAG, the current dormancy metrics suggest that Solana could be approaching a long-term bullish phase.

This article delves into the recent performance of Solana (SOL), exploring critical market indicators and transaction trends that may shape its future.

Market Indicators Point to Potential Recovery for Solana (SOL)

As we transition through 2025, Solana’s performance has showed notable fluctuations, notably testing the $100 mark, which some analysts believe is a pivotal level. Positive signals are starting to emerge as on-chain activity appears to reverse its downward trend, indicating that investor interest might be picking up.

Transaction Volumes Show Resilience in 2024

The 2024 transaction metrics for Solana have been remarkable, with volume levels significantly higher compared to previous years. This resurgence stems from the network’s increasing utility, driven partly by the growing adoption of decentralized applications (dApps) built on the platform. According to recent data, the number of unique transactions has shown a consistent increase, reinforcing the narrative that Solana is gaining traction as an attractive platform for developers and users alike.

Assessing Investor Sentiment: The Spent Output Profit Ratio (SOPR)

The Spent Output Profit Ratio (SOPR) has been a critical metric for gauging market sentiment among SOL holders. Currently positioned under 1 at 0.987, this figure indicates that many investors are selling at a loss, reflecting broader market challenges. However, the sustained decrease in SOPR since late February points to a possible accumulation phase, as seasoned investors may start to consider new positions at these lower price levels.

The Importance of Dormancy Flow Metrics

The concept of dormancy flow, which measures the average number of days coins have been inactive before being transacted, has emerged as a crucial indicator for Solana’s long-term prospects. As represented in the accompanying chart, the dormancy flow metrics are near historical lows, akin to levels observed back in 2020 when SOL was trading around $2. This pattern raises the question of whether the current market is witnessing a potential bottom, particularly as dormancy flow continues to decline, suggesting that we might be entering a bullish phase soon.

As these metrics demonstrate, while current market conditions may seem challenging, the accumulated data signals a potential shift in sentiment that could lead to a resurgence in price action.

Conclusion

In summary, although Solana (SOL) has faced significant pressures reflected in its SOPR and dormancy metrics, signs of recovery are increasingly apparent. The fluctuation around the $100 mark suggests a pivotal point, while the uptick in transaction volumes provides a glimmer of hope for investor confidence. As always, potential investors should remain cautious and consider these metrics as part of a broader analysis when deciding on future investments.