Solana’s Rate Reached $100 For the First Time Since “Ignition”
On Monday, August 30, the SOL / USD exchange rate climbed to a new record of $103.06 after a 9.35% intraday rally.
Solana’s upward movement began a few days after the announcement of the mysterious “Ignition” featuring a purple flame lighter. The crypto community suggested that it was about burning SOL tokens. However, this assumption may not be correct.
As a public blockchain, Solana relies on SOL for two main purposes: betting and transaction fees. The protocol burns off a portion of the transaction fees it collects to cap SOL’s offer over its release of SOL 500,000,000.
However, Solana is also creating new tokens based on a “disinflationary inflation schedule,” in which the SOL issuance rate periodically slows down after starting from its highest value. Meanwhile, Solana argues that supply will eventually stabilize at “a predetermined long-term inflation rate”.
But if Ignition is a token burn event, then it doesn’t deserve a separate landing page on Solana’s official website.
In addition, the announcement for Ignition is signed: “There is no limit. What are you launching? ”. And also, the event has a specific date: from August 31 to October 8. Based on this, Ignition may be more of an event for developers of decentralized applications or creators of non-fungible tokens (NFTs), rather than an episode of token burn.
But all the same, Ignition influenced the token price. On the day of the announcement, August 27, the SOL/USD rate jumped 17.62%. The next day, the pair climbed another 9.2%.
However, the rally slowed on Sunday shortly before hitting the $100 mark, dropping more than 1.5%. After the token resumed its growth, however, later SOL shares fell below $100 due to the desire to take profit.