New Model Flags Solana as Deeply Undervalued at $87: SOL Price Analysis

Solana (SOL) traded at $87 as of 2026-02-10, a 66% drop from its January 2025 peak. Despite a bearish outlook, a new investment thesis predicts a potential rebound to $250 in 2026. The shift in Solana's revenue from speculative meme coins to micro-sized stablecoin transactions has raised new optimism about its long-term prospects.

The crypto market remains under pressure, with Bitcoin facing major outflows. In contrast, Solana and XRP saw inflows in the past week, signaling a shift in capital allocation. Institutional investors sold $264 million in Bitcoin but added $8.2 million to Solana and $63.1 million to XRP.

Analysts are watching Solana's price action closely, as technical indicators suggest a continuation of the bearish trend. The recent breakdown below the $100 level and shrinking DEX volumes have raised concerns about Solana's vulnerability to further declines.

Why the Move Happened

Solana's price has been heavily impacted by its association with speculative trading in meme coins. Revenue from this activity has declined, contributing to volatility. However, a shift toward stablecoin transactions has emerged as a potential new growth driver for the Solana ecosystem.

This transition is supported by data showing growing interest in stablecoins as a more reliable use case for blockchain technology. Standard Chartered's analysis highlighted the potential for Solana to become a leading platform for stablecoin payments.

How Markets Responded

The broader crypto market is seeing a reallocation of capital away from Bitcoin and into altcoins like Solana and XRP. This trend reflects investor diversification strategies amid economic uncertainty. Ethereum also saw $5.3 million in inflows, indicating broader optimism about alternative blockchain platforms.

CoinShares reported that overall digital asset outflows have slowed, suggesting a potential stabilization point. The decline in Bitcoin's dominance has opened opportunities for altcoin investors to rotate into assets with more favorable fundamentals.

What Analysts Are Watching

Technical analysts are focusing on key price levels and patterns that could determine Solana's next move. The breakdown below the $100 level has reinforced bearish bias, with traders monitoring support levels at $90, $85, and $82.

A breakdown below $87 could trigger further downside to $79 and beyond. Conversely, a rebound above $93.53 could initiate a bullish reversal, though this remains unlikely without broader market support.

On-chain metrics and funding rates also indicate that the bearish momentum remains intact. While the RSI has entered the oversold zone, this does not guarantee a reversal without confirmation from key price levels .

Market participants are also closely watching Bitcoin's performance, as its downtrend has influenced the broader crypto market. A potential rebound in Bitcoin could provide a tailwind for altcoins like Solana, but this remains uncertain.