Solana Has NFTs and Fund Managers Boosting it Now

  • Solana (SOL) has proven to be something of a unicorn among smaller-cap digital assets. 
  • The network surpassed a critical NFT sales milestone.
  • Solana gaming NFTs marketplace is garnering serious funding.
Concept art of the Solana (SOL-USD) blockchain.
Source: Shutterstock

Solana (SOL-USD) is known for a  lot of things. Its lightning-fast transaction speeds make it one of the most attractive digital assets out there. But there are lots of other reasons to consider Solana aside from its transaction speed. 

Let’s start by understanding how Solana remains something of an outlier in a very positive sense of the word. After that we’ll launch into non-fungible tokens (NFTs). Solana has really made waves in that realm of late. But all in all, SOL looks to be headed upward currently. 

Unicorn Status

A recent bi-monthly survey of fund managers about digital assets conducted by CoinShares suggests Solana is a special case. One of the primary takeaways of that survey was that digital assets with large capitalization are favorable currently. That primarily favors Bitcoin (BTC-USD)  and Ethereum (ETH-USD) as they make up the majority of highly capitalized digital assets. 

The bad news was that the rise of large-capitalization digital assets is occurring to the detriment of small-cap digital assets. However, Solana stood out as the one crypto in that survey that the fund managers cited as having an increasingly compelling growth outlook. 

SOL-USD Solana $131.32

That matters because institutional investor capital is moving into the largest cryptos as measured by market cap. Solana is the sixth-largest digital asset by that measurement. But its market cap of $43 billion pales in comparison to those of Bitcoin and Ethereum. They boast market caps of $872 billion and $415 billion, respectively. 

The survey suggests that Solana is a versatile asset capable of playing with the big boys. 

NFT Sales Impress

Solana is the third-ranked blockchain based on non-fungible token (NFT) sales of all-time. The project recently passed an important milestone by topping $1.5 billion worth of NFT sales volume

That places it behind only Ronin (RON-USD) and Ethereum in terms of NFT sales volume. The news comes on the heels of an earlier prediction by JPMorgan (NYSE:JPM) that Solana could upend Ethereum in the NFT sector moving forward. 

There are a few things to note here, though. Ethereum has accounted for more than $21 billion of NFT sales compared to Solana’s $1.5 billion. On top of that, the value of the NFTs sold through Ethereum is also much greater. The $21.336 billion in sales equates to an average NFT transaction value of $18,806 per sale. Solana’s average transaction value per sale works out to be roughly $4,770.

That assertion, made in January, relied on the fact that Ethereum’s dominance in the NFT market had fallen from 98% to 80% in the months prior to January.  

Solana and Gaming NFTs

Fractal is a marketplace for Solana gaming NFTs that is quickly gaining backing from the likes of Andreessen Horowitz, Coinbase (NASDAQ:COIN), and others. Fractal raised a seed round of $35 million. And Fractal was co-founded by the founder of Twitch, Justin Kan. 

The NFTs that will be available on the marketplace are essentially in-game assets including things like avatars, weapons, and land plots. 

Fractal intends to expand its NFT gaming to other blockchain networks in the future but it will begin by supporting Solana. That bodes well for Solana as the space has lots of potential. It also speaks to the notion that Solana has an edge in the NFT space. 

Justin Kan may be biased, but he tweeted that he believes gaming NFTs are way bigger than Twitch, which he built. 

Takeaway

Solana continues to be an outlier in the most positive sense of that word. It is somewhat surprising that it maintains positive perception as the rest of the small cap crypto space faces trouble. That’s a testament to its power, though. And it’s a reason to consider a purchase. 

The other reasons relate to its presence in the NFT space. All told, it’s a strong crypto moving in the right direction which makes it buy-worthy. 

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks.Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.


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