John Isige
Solana price has started a fresh offensive attack on the US dollar, with its value increasing by 1.5% in 24 hours to trade at $22.71 at the time of writing. This new optimistic outlook for SOL, the token powering the competitive smart contracts platform, comes amidst mounting concerns over the network’s stability. The Solana network suffered another outage on Saturday, forcing node operators to downgrade to a previous version of the protocol.
Can Solana Solve Its Frequent Network Outages?
Solana is back in the limelight, but this time not for good reasons, considering the smart contracts protocol went offline “at approximately 05:46:16 UTC 2023-02-25.” On Monday, the core development team confirmed to the community that “Solana Mainnet Beta suffered a significant performance degradation.” Efforts to reinstate the network were futile, forcing the “validator community to opt for a restart of the network.”
The community has raised questions over what may have caused the network to go offline, but the core engineering team says the cause was yet to be discovered. Nonetheless, an investigation is underway.
For now, investors have no option but to accept the explanation from the team, which outlined that all validator nodes autonomously switched to a “vote-only mode,” otherwise referred to as a “safe mode.” Safe mode is a feature designed to allow the network to reinstate the protocol in circumstances where data is either inaccessible or not available.
The core engineering team added that although consensus was operational, the network could not process user transaction data. The need to have the network back online and fast, saw the validator community unanimously decide to downgrade to the previous but stable upgrade—v1.13.6. This move was necessary to eliminate any potential risks to the network.
“At approximately Feb 26, 2023 – 01:28 UTC Solana Mainnet Beta was successfully restarted and the network resumed processing user transactions,” the core engineering team said via a blog post.
How Steady Is The Solana Price Uptrend Amid Network Stability Concerns?
Intriguingly, Solana price is holding firmly to support at $20.00 oblivious to its network outage woes. This support has been in place since mid-January when SOL’s aggressive push from late December stalled below $27.00.
If buying pressure continues to increase behind Solana price, the daily green candle printing on the chart could validate the next breakout above the seller congestion at $27.00, thus paving the way for gains beyond $30.00.
The token’s immediate confluence support at $21.67 shows bulls may take control in the coming sessions or days and resolve to boost SOL higher. Key indicators forming this confluence support include the 50-day Exponential Moving Average (EMA) (line in red), the 100-day EMA (line in blue), and the lower ascending trendline (continuous line).
Despite the bullish outlook seen on the daily chart, investors may need to see more evidence that Solana price can uphold recovery above $30.00. The network outage over the weekend was not the first one. Solana frequently went offline in 2022 which significantly impacted its reputation.
Other leading smart contracts platforms such as Ethereum and Cardano have never suffered network outages, which brings the question – is the Solana blockchain dealing with a design flaw?
The possibility of the trend reversal from $27.00 continuing cannot be thrown out the window just yet – not when the Moving Average Convergence Divergence (MACD) indicator on the same daily chart upholds a sell signal.
The MACD is a momentum indicator undelaying the chart like the Relative Strength Index (RSI). Traders use this index alongside other indicators to ascertain the direction of the trend. For instance, a sell signal would come into play when the MACD line in blue crosses below the signal line in red. Therefore, some investors may sell SOL, compelled by this call to sell and the recent network outage, whose cause remains unknown.
Solana Co-founder Shares Plan To Improve Network Upgrades
Anatoly Yakovenko, the co-founder of the Solana ecosystem, reaffirmed his dedication to enhancing network security and stability in the wake of the latest network disruption.
“Delivering a fast, reliable, and scalable network to move toward a better, decentralized web remains a top priority. The issues around last week’s 1.14 network update – which focused on improvements for speed and scale – made it clear how maintaining stability during these major updates remains a challenge,” Yakovenko wrote in a blog post on Tuesday.
Yakovenko added that Solana’s core engineers are working on improving “the process for software release rollouts by bringing in additional external developers and auditors to test and find exploits.” The core engineering team will from now henceforth, work closely with validators to improve the software release process.
Investors may consider giving the core engineering team a chance to enhance the software upgrade process as outlined by Yakovenko before selling SOL. The smart contracts token is preferred for its high transaction throughput and low fees, making it suitable for the decentralized finance (DeFi) sector.
Price performance in the next few days would also help determine the direction Solana price may take. A break above resistance at $24.00 may validate an upswing past the next hurdle at $27.00. Price action above this supply area could quickly rebuild investor confidence and set SOL on the path to $40.00.
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This article was written for Business 2 Community by John Isige.
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