Solana Surges Past $130: A Breakout in the Making or Just a Blip?

Solana Surges Past $130

Solana made waves this week, soaring over 20% to reclaim the $130 mark. This sharp rebound not only outpaced most large-cap cryptocurrencies but also marked a swift recovery from the recent wave of market FUD. One of the standout developments was SOL’s growing strength relative to Ethereum, with the SOL/ETH trading pair decisively breaking through its early February resistance.

Adding fuel to the fire, Solana’s DeFi ecosystem achieved a historic milestone—surpassing Ethereum in lifetime revenue. As of now, Solana has generated $2.56 billion in fees compared to Ethereum’s $2.27 billion, a staggering lead that highlights its rising dominance.

With booming on-chain revenue, a surging SOL/ETH ratio, and unmatched transaction throughput, Solana’s breakout appears more than justified. But the key question remains: can the bulls carry this momentum forward?

Q1 Recap: A Rough Patch for Solana

The first quarter of 2025 wasn’t kind to Solana. The token suffered a steep drawdown of over 30%, underperforming many of its large-cap peers. This slump wasn’t limited to price action—it extended to structural fundamentals as well.

Solana lost its grip on the $100 billion market cap club, slipping behind Binance Coin (BNB) and ranking sixth among major crypto assets. On-chain data painted a bleak picture: millions of SOL tokens were unstaked, creating excess supply in the market. At the same time, whale distribution intensified, reinforcing a strong sell-side narrative.

In essence, Q1 was marked by structural unwinding and bearish liquidity flows, overshadowing any bullish resilience.

The Case for a Turnaround

Now, however, signs of a reversal are starting to take shape. Solana’s Total Value Locked (TVL) recently surged to an April high of $8.54 billion, signaling a potential inflection point.

Meanwhile, long-term holder activity suggests growing confidence. The HODLer Net Position Change turned positive, reflecting a steady influx of SOL into long-term wallets. Impressively, this marked the longest accumulation streak in more than six months—a period typically associated with cyclical market bottoms and the onset of new rallies.

But there’s a catch. Despite growing long-term conviction, retail participation remains sluggish. New wallet creation has dropped to its lowest level in half a year, indicating that broader user engagement is still lacking.

A Structural Reaccumulation Phase?

What we’re likely witnessing is a phase of structural reaccumulation—long-term investors steadily accumulating, while short-term price action remains muted. Until retail momentum kicks back in, price volatility could stay range-bound.

In the meantime, patient long-term holders may have to endure a bit more turbulence. But if history is any guide, this quiet build-up phase might just be laying the groundwork for Solana’s next major move.