This Altcoin Price Breaks Record With “Mysterious News”! Here are the details…

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ALTCOIN NEWS

Traders are raising the price of the altcoin as Solana (SOL) teases the community with a mysterious "ignition" feature set to launch on August 31st. Solana prices soared on August 30 as traders speculated about the launch of an important but mysterious feature this week. The speculation arose largely because of Solana's "ignition" teaser video featuring a purple-flamed lighter.

Ignition may not be a SOL token burn

Solano price climbed to a new record high of $103.06 after an intraday rally of 9.35%. The upward move came days after Solana promoted "ignition" on her official media accounts. However, the team gave very few details about the vehicle. The Solana community speculates that it will be about burning SOL tokens.

As a public blockchain, Solana relies on SOL to assist with two main tasks: Stake and Transaction Fee, according to analysts. The protocol burns some of the transaction fees it collects to limit the supply of SOL to 500,000,000 SOL issuances. However, Solana is also creating new tokens based on a “no-inflation chart” where the SOL issue rate periodically decreases after starting at its highest value. Meanwhile, Solana claims that supply will eventually stabilize at "a predetermined long-term inflation rate."

Crypto traders say that if ignition is a token burning event, it does not deserve a special landing page on the official Solana website. They also attribute this primarily to previous SOL burns, which did not see exclusive teasers from the protocol's Solana team. Also, in the Ignition teaser, rather than the token burning episode, “The sky is the limit. What are you throwing?" It is said between August 31 and October 8, emphasizing that this could be an event mostly for decentralized application developers or Non-Fungible Tokens (NFT).

Snapshot from Solana's official Reddit community page on Ignition. Source: Reddit

According to analysts, traders are using Ignition as a catalyst to push the altcoin price higher. On Friday, when the announcement was made last week, the price of SOL rose 17.62%. The next day, the price climbed another 9.2%. However, the rally slowed down just before hitting $100 on Sunday, dropping over 1.5%. However, on the first day of the new week, when top cryptocurrencies including Bitcoin (BTC) and Ether (ETH) fell, Solana (SOL) continued to rise.

Overvaluation risks remain for altcoin, according to analysts

Solana prices started to rise after Bitcoin slumped below $30,000 on July 20 and a general crypto recovery. The altcoin price then gained upward momentum on a number of optimistic fundamentals, including the decision by digital asset manager Osprey Fund to launch a Solana-specific fund for institutional investors.

As you may know, last week, real-time data feeder Pyth Network announced that Solana's Proof-of-Stake (PoS) has gone live on the blockchain through its cross-chain communication tool called Wormhole. And before that, Solana has also successfully entered the NFT industry with the launch of Degenerate Apes in mid-August. The project sold 10,000 pictures of funny monkeys in just eight minutes, with sales of 96,000 SOLs (over $5.9 million at the time).

According to analysts, Solana's 369% price boom from the July 20 low of $21.96 made the SOL highly overvalued based on the current relative strength index reading (around 81). Analysts say this means a short-term correction in the coming sessions.