Analyzing Solana: Why Analysts Say It's Tough to Invest

In recent market evaluations, Solana (SOL) has faced significant challenges, primarily influenced by the ongoing prominence of memecoins and market fluctuations. Analysts highlight the difficulty of owning SOL amidst diminishing memecoin hype and external pressures.

Key Takeaways

Solana’s on-chain activity reveals that memecoins constitute 41% of its total revenue.
Speculators estimate an 11% chance of SOL reaching $200 and only a 2% chance of hitting $250.
Currently, SOL is trading above $150 after experiencing a 38% decline from its Q3 peak of $253.
Compared to its all-time high of $295, SOL has decreased by 47%.
Analyst Flood notes that holding SOL feels “very difficult” due to market dynamics, claiming the current internet capital markets narrative is misleading.

Solana

The Role of Memecoins in Solana's Landscape

In early 2025, Solana surged to $295, largely fueled by the launch of the Official Trump (TRUMP) memecoin. This shift substantially influenced market trends in 2023 and 2024. Research conducted by AMBCrypto indicates that memecoins continue to dominate Solana's application revenue, accounting for 41%. This suggests that marketplace traction is predominantly reliant on memecoins rather than genuine utility.

Solana

However, since late 2024, the momentum surrounding memecoins has significantly declined, which is evident from recent revenue posters. Flood’s observations underscore that the lack of excitement around memecoins correlates with SOL's ongoing weakness.

Solana’s Position in Tokenized Markets

Despite the challenges, Solana has made strides in leading the sector of tokenized stocks. While Ethereum continues to dominate the broader tokenized markets, Solana's advancements in on-chain stock trading are notable. Nonetheless, this progress has yet to translate into significant engagement for SOL.

Recent Pressures from Alameda Research

Additionally, Solana faces short-term pressures due to recent asset unlocks from Alameda Research aimed at repaying victims of the bankrupt FTX exchange. In its latest monthly unlock, Alameda sold 193,000 SOL valued at around $30 million. This amounts to a considerable selling pressure for institutions to potentially absorb.

On November 11, there were institutional inflows of approximately $8 million. Despite $118 million in inflows the previous week, the combination of limited institutional demand and general market weakness is restricting SOL’s recovery capabilities.

In options markets, traders are pricing an 11% chance that SOL could reach $200 and a mere 2% for a rise to $250 by the end of November. This reflects a broader market pessimism regarding a potential SOL rally in the upcoming weeks.