- Solana surged 9% past $110, reaching its highest level since January as traders reacted to a proposed cut in SOL inflation.
- The $100 level remains key support, while $120 could trigger profit-taking and short-term volatility.
Solana (SOL) surged 9% on August 28, breaking above $110 and reaching its highest level since January. The sharp rally came as Bitcoin and Ethereum posted limited gains, putting Solana in the spotlight.
The move was also supported by growing attention around a proposal that could significantly reduce SOL’s inflation rate. If approved, the change could reduce the supply of new SOL entering circulation over the coming years.
Solana Price Climbs to Six-Month High
SOL gained 9% in a single day as buyers pushed the price above the $110 level. This marked Solana’s highest price since January and highlighted its stronger performance compared with Bitcoin and Ethereum.
The rally shows renewed buying interest in SOL after a period of weaker price action. Traders are now watching whether Solana can maintain its gains and move toward the $120 resistance level.
However, the rapid increase could also lead to short-term profit-taking. Traders who entered at lower prices may sell some of their holdings if SOL approaches $120.
Deflation Proposal Could Reduce SOL Supply
The proposed change to Solana’s inflation system has become another important factor behind the recent price move.
According to SolanaFloor, the double deflation proposal has reached the required quorum. More than 33% of voting participation has been recorded, while votes supporting the proposal have reached 25%.
If the proposal passes, Solana’s inflation rate could fall by roughly half. The change could potentially reduce the supply by about 19 million SOL over the next six years.
A slower increase in the circulating supply could improve Solana’s long-term supply-demand balance. It could also increase scarcity if demand for SOL continues to grow.
$100 Remains a Key Support Level
Despite the strong rally, Solana could face increased volatility near $120. Profit-taking and leveraged positions could create temporary selling pressure if the price reaches that level.
The $100 mark has now become an important level for SOL. A daily close above this psychological support could help maintain the broader bullish outlook.
If buyers continue to defend $100, Solana could attempt another move toward $120. A break above that resistance would give traders a new level to watch as the rally develops.
For now, SOL’s ability to hold above $100 remains crucial as the market assesses whether the latest surge can continue.
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