In brief
- Solana reached $200, its highest in five months, alongside a $1.5 billion rise in open interest over three days.
- Options data signals growing investor caution, with implied volatility and 30-day skew both spiking.
- Upcoming macro events—including Fed remarks, jobless claims, and a rate decision—may test the rally.
Solana climbed to a five-month high on Monday, drawing renewed attention to Layer 1 blockchains and signaling a potential shift in crypto market sentiment for altcoins.
Solana briefly touched $200 during early Asian trading, extending a 50% rally over the past month. It has since fallen below the $200 tag to $197, CoinGecko data shows.
The native token’s growing market strength, further reflected in its $1.5 billion uptick in open interest over the past three days, hints at a substantial influx of capital, according to some.
Solana traders appear to be preparing for a “turbulent month,” Sean Dawson, Head of Research at options trading platform Derive, told Decrypt.
He pointed to a growing gap between the 30-day realized and implied volatilities as the primary reason. The implied volatility, which tracks the future expectations of options traders, has more than tripled from 4% to 14%.
In other words, the recent jump in implied volatility and widening skew suggest traders have repositioned for a potentially bullish breakout.
Traders are now also paying more for bullish call options relative to bearish put options than they were a few days ago.
Despite the prevailing short-term focus on Ethereum, where that digital asset has sparked a 60% rally in just 30 days, Dawson projects a positive outlook for the broader Layer-1 landscape over the next six months.
He anticipates L1s emerging as the “winner,” citing developments like “Trump’s big beautiful bill and GENIUS Act,” along with aggressive institutional adoption of Ethereum.
Dawson expects Solana to be a significant beneficiary within that context, due to its “high beta” and surging on-chain activity from the resurgence in “meme coin trading.”
Several Layer-1s have upcoming ETF launches that could serve as meaningful catalysts, Jake Ostrovskis, an OTC trader at Wintermute, told Decrypt.
“Solana, XRP, and Litecoin are all expected to launch with a high degree of certainty (~95%) in 2025, with additional speculation building around Cardano, Polkadot, Hedera, and Avalanche,” he said. “These developments could open the door to passive inflows, potentially making these tokens a more significant part of the broader market.”
Still, the long-term outlook and sustained bullish trajectory depend heavily on favorable monetary conditions.
Those include Thursday’s jobless report and the July 30 CPI print, which could offer clues on the U.S.’s fight with ongoing inflation.
Should labor market softness continue and inflation tick down, Dawson concludes, “risk assets like crypto could soar sooner than expected.”
Editor’s note: Adds comments from Ostrovskis
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