With the price of Solara (Crypto: soil) A decrease of 36% in the last 30 days only and the blockchain has shook by several high -level scandals and scams, investors wonder if there is a juicy opportunity to buy the dive here – or if the days of glory of the digital part is firmly in the past.
There is a correct decision to do here, so let’s analyze the situation and let’s try a course for your wallet.
In general, when an asset undergoes a profound drop in its price, investors must understand why. Then, with these reasons in hand, they must compare their original Investment thesis To buy the assets and determine if this thesis is still valid in the light of the new events that have led to the decline.
In the case of Solana recently, the engines of the decline are a short -term symptom of the success of the blockchain. As you may have heard, it’s the game chain on coins.
You have probably also heard that Solana is the place where Lots of fraudulent activities arrived. And as you can probably guess, it is very frequently the same money activity which is fraudulent in one way or another. There are drawbacks to be a leader in the drop in new parts of memes. But some summary patterns are larger and more attracting attention than others.
In an international scandal which is still fulminating, in mid-February, the president of Argentina, Javier Milei, approved the launch of a memes piece on Solana called $ libra. After its market capitalization initially climbed $ 4.5 billion, it then crushed around 90%.
Then, following, some cryptocurrency influencers of the Solana community in the United States said they had launched the token in collaboration with Milei as part of a corruption program for purposes that are currently unknown.
In addition, there are allegations according to which the initiates linked to the token were able to take about $ 107 million, which would imply that the entire launch was a pump and waste program if the allegations have proven to be true. Legal surveys are underway in Argentina to discover more details.
We do not know how the saga will be resolved, but one thing is clear: it is a terrible ad for Solana on several fronts. It does not seem good when the heads of state are involved during potentially criminal launches of memes.
This does not seem to be when very visible influencers associated with a chain are exposed as promoting such an activity, because it considerably reduces the level of confidence which promotes more dollars of investment in which take place regularly.
But does that mean that you should avoid buying Folana entirely, even when it is much cheaper than before?
Think about the reason why investors have recently dropped Solana. The smell of scandal is never attractive when it floats on your investments. But a currency fiasco committed on Solana’s blockchain does not imply that the main reasons for buying it are reduced.
After all, he still has a huge and growing ecosystem of projects in decentralized finance, art, artificial intelligence (IA) – and yes, money. Its intelligent contract features are still actively developing. And it is always an inexpensive and quick blockchain to transform, compared to older chains like EthereumThis allows Solana to siphon the value of its more clumsy competitors. All these things stimulate a higher demand for the medal.
If this is not enough, regulators are currently progressing to approve the trading of Solana’s term contracts on certain scholarships, and it could also be held in funds negotiated on the stock market (ETF) if they are also approved. This type of regulatory permissiveness would be a massive green light for the future value of the medal.
And in case you have forgotten, during the FTX scandal in early November 2022, Solana was the chain most affected by reprehensible acts and the following repercussions, losing more than 61% of its value in just one week after bankruptcy FTX. This scandal is not as bad, and the price of the play finally rebounded after the FTX crash.
So, should you buy DIP with Solana? I think you should, assuming that you can accept that it is a risky cryptocurrency game and that you may have to wait a bit that its price is recovering from the current level. With more than one higher price engine already at work, the crypto will probably erase this bump on the road in due time.
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Alex Carchidi has positions in Ethereum and Solana. The Motley Fool has positions and recommends Ethereum and Solana. The Word’s madman has a Disclosure policy.
