Solana Price Drops 5% Amid Crypto Market Pullback Despite High Fees

Solana's price experienced a decline on Friday, dropping to $143 after a 5% decrease in 24 hours. This price drop occurred amidst a broader pullback in the crypto market. Despite this decline, the Solana network has outperformed Ethereum and other blockchains in terms of fees. However, one market expert has labeled the Solana blockchain as a "house of cards."

Data from TokenTerminal indicates that in the last 30 days, the total fees on the Solana blockchain reached $74 million, significantly higher than Ethereum's $35 million. This surge in fees was largely driven by the activity on the PumpFun meme coin launchpad. However, the founder of The DeFi Report, Michael Nadeau, argues that these fees do not reflect high activity on the Solana blockchain. He stated that the Solana growth arc is impressive, but under the hood, it looks like a house of cards. Nadeau further noted that 95% of the total fees on Solana came from only 1.26% of wallets, with most of the fees generated from meme coins being traded on the blockchain.

Despite the criticism, some asset managers believe that Solana is rivaling Ethereum in DeFi dominance. The one-year uptime record of Solana is seen as a positive factor for its adoption, which could potentially benefit the Solana price. However, the technical analysis of Solana's daily chart shows a significant surge in selling activity and a lack of fresh demand from retail traders. The RSI has flattened below 50, indicating a bearish momentum where buyers are not purchasing the recent dip. The bull-bear power indicator also suggests that selling activity is higher than buying activity. If sellers remain in control, Solana's price could lose its make-or-break support level at $142, potentially leading to a decline to the $110 level. Conversely, if the Solana price bounces from this support level, it could push the price up towards the $179 resistance level, paving the way for a recovery past $200.

This technical outlook presents a bearish Solana price prediction. However, as network activity rises, it could positively impact the altcoin's future price outlook. The broader sentiment in the crypto market remains bearish, with selling activity dominating the landscape. This bearish sentiment is reflected in