The logo of the cryptocurrency platform Solana.

Jakub Porzycki | NurPhoto via | Getty Images

The price of the Solana token rose on Wednesday due to an ongoing rally in altcoins and optimistic comments about the token from famous technology investor Cathie Wood.

Solana was last up nearly 10% at $61.36. Earlier in the day it was up as much as 16%. The price has almost tripled in the last month.

The increase comes a day after Ark Invest CEO Cathie Wood praised the company’s performance this year on CNBC.

“Solana is doing a really good job,” she told CNBC’s “Squawk Box” on Tuesday. “Ether was faster and cheaper than Bitcoin [back] a day – that’s how we got ether. Solana is even faster and [more] cheaper than Ether.”

Wood continued on CNBC Pro Talks that she “really likes Solana,” and also pointed out that the downtime – the time the network is down, undergoing maintenance, or experiencing an outage – is “much higher than Ethereum.” .

“People are willing to put up with that because the transaction sizes may not be as big or for some reason not as important. They just want speed and cost as their top priority,” Wood told CNBC PRO. “Everyone from [the networks] will have a place.

Solana, the sixth-largest crypto token by market cap according to CoinGecko, became the darling of the crypto world in the 2021 bull market as it sold investors a vision of something like Ethereum but without the slow and expensive transactions.

According to data provider Kaiko, activity on Solana has increased throughout the year, particularly on liquid staking protocols like Jito. The token tops the list of most traded altcoins on exchanges available in the US this year, overtaking Dogecoin, Litecoin, Polygon’s MATIC and Ripple’s XRP.

More recently, the token followed a broader crypto market rally led by Bitcoin that began on October 24, when the coin doubled this year and surpassed $35,000 for the first time since May 2022. Ether followed shortly after and rose to the psychological key at the $2,000 level. Historically, altcoin rallies tend to follow ether.

“After October 24, Bitcoin began to lose momentum, which during Bitcoin bull markets causes traders to lower the risk curve and move to altcoins to make big profits,” said Mikołaj Zakrzowski, analyst at data provider CryptoQuant.

A year ago this time, the coin faced a defining moment after the FTX explosion sent it down 70% in two days and briefly traded below $10. FTX and its now-ousted leader Sam Bankman-Fried are widely credited with committing significant funds and resources to the implementation of the Solana project to get it off the ground.

Solana is up about 510% this year and has been one of the best-performing cryptocurrencies in 2023. In comparison, Bitcoin and Ether have gained about 120% and 68%, respectively.

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