Solana (SOL) Soars with Tokenized Stocks, Will it Break $120 and Race to $125?

▲ Solana (SOL) ©

Solana (SOL), benefiting from a double boost – the US regulatory authorities' approval of tokenized stock trading and a large-scale network upgrade – is leading the altcoin surge and aiming to break through $120.

According to investment media TradingNews on September 18 (local time), Solana surged 9.73% in one day, reaching $111.51, significantly outperforming Bitcoin (BTC)'s 5.42%, Ethereum (ETH)'s 5.61%, and XRP's 6.94% gains. This rally was directly catalyzed by the US Securities and Exchange Commission (SEC)'s announcement of an "Innovation Exemption" measure, allowing regulated exchanges to trade tokenized securities for five years. Solana is considered the biggest beneficiary of this regulatory easing, as it has already been processing billions of dollars worth of tokenized stock transactions weekly and has led the market, which grew rapidly to $3 billion by early September.

Technical upgrades to the network itself have also laid the groundwork for institutional capital inflow. Solana's Transaction V1 update more than tripled the transaction size limit from the previous 1,232 bytes to 4,096 bytes. This allows for the smooth processing of complex regulated securities transactions, such as corporate wallet approvals, compliance verification, and privacy proofs, within a single transaction, thereby significantly narrowing the technological gap with Ethereum. Furthermore, the introduction of Alpenglow, which shortens transaction finality to 150 milliseconds, and Firedancer, a second independent validator client, is also progressing smoothly.

However, the slowdown in exchange-traded fund inflows is considered a short-term limitation. While the net assets of nine US Solana spot ETFs reached $1.41 billion as of early September, and staking products like Bitwise's BSOL surpassed $1 billion in cumulative inflows, weekly net inflows plummeted by 96%, from $153.87 million at the end of August to $6.18 million in the first week of September. Although futures market open interest has reached $135.98 million, indicating buying momentum from derivatives traders, a sustained rally requires actual institutional spot buying of over $50 million per week.

From a technical analysis perspective, whether the $120 resistance level is broken is a critical juncture determining future upside. If Solana breaks above $120 on a daily closing basis, an additional upward path of approximately 12.1% opens up to the next targets of $125 and $130. Conversely, if it fails to hold the $106 support level recorded in the Asian session and slips below the psychological support of $100, which it has maintained throughout September, this rally could be invalidated, leading to a correction down to the $95 support level.

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