Solana (SOL) has shown limited price movement recently despite a substantial accumulation of the token. The price has remained relatively stable in May, likely due to the altcoin’s overheating.
While this stagnation is a sign of caution, the market is optimistic, which could lead to potential gains for Solana in the near future.
Solana Investors Continue Accumulation
Over the past 10 days, the balance of Solana on exchanges has dropped by 2.2 million SOL, valued at approximately $381 million. This decline in supply indicates that investors have been accumulating Solana during this period.
The ongoing accumulation is likely driven by a mix of factors, including the broader bullish market sentiment, fear of missing out (FOMO), and the expectation of future price appreciation.
This reduction in supply reflects increased investor confidence, with many choosing to hold rather than sell their SOL. As more investors accumulate the token, the supply on exchanges decreases, potentially creating upward pressure on the price in the long run.
Solana’s overall market momentum shows signs of potential volatility. Technical indicators, such as the Bollinger Bands, reveal that the bands are narrowing.
This tightening of the bands is a classic signal of a potential squeeze, which often precedes a surge in price volatility.
Should the squeeze result in a bullish breakout, Solana could see a rise in price, especially with the broader market showing positive momentum.
However, the narrowing of the Bollinger Bands also suggests that a period of consolidation could occur before any significant move.
Solana’s price has been moving sideways for much of May, likely due to the token overheating in the previous weeks. However, this cooling-off period could create an opportunity for a bullish move.
As the broader market continues to show positive signals and the accumulation trend persists, Solana may rise from its current consolidation phase.
At $173, Solana is testing critical support levels. To initiate a rally, Solana would need to secure $178 as support. If it manages to break above $180 and successfully breaches $188, it could indicate the start of an uptrend.
A successful breakout above these levels would signal further upward potential.
On the other hand, if Solana fails to maintain support at $178, it could fall below the $168 mark, potentially reaching $161. Such a decline would invalidate the bullish thesis and suggest further downside risk for the token.
China’s recent directive for its state-owned banks to decrease reliance on the US dollar has amplified a growing trend among countries seeking alternatives to the dominant reserve assets. In some instances, Bitcoin has emerged as a viable competitor.
BeInCrypto spoke with experts from VanEck, CoinGecko, Gate.io, HashKey Research, and Humanity Protocol to understand Bitcoin’s rise as an alternative to the US dollar and its potential for greater influence in global geopolitics.
The Push for De-Dollarization
Since the 2008 global financial crisis, China has gradually reduced its reliance on the US dollar. The People’s Bank of China (PBOC) has now instructed state-owned banks to reduce dollar purchases amid the heightened trade war with US President Donald Trump.
China is among many nations seeking to lessen its dependence on the dollar. Russia, like its southern neighbor, has received an increasing number of Western sanctions– especially following its invasion of Ukraine.
Furthermore, Rosneft, a major Russian commodities producer, has issued RMB-denominated bonds, indicating a shift towards RBM, the Chinese currency, and a move away from Western currencies due to sanctions.
This global shift away from predominant reserve currencies is not limited to countries affected by Western sanctions. Aiming to increase the Rupee’s international use, India has secured agreements for oil purchases in Indian Rupee (INR) and trade with Malaysia in INR.
The country has also pursued creating a local currency settlement system with nine other central banks.
As more nations consider alternatives to the US dollar’s dominance, Bitcoin has emerged as a functional monetary tool that can serve as an alternative reserve asset.
Why Nations Are Turning to Bitcoin for Trade Independence
Interest in using cryptocurrency for purposes beyond international trade has also grown. In a notable development, China and Russia have reportedly settled some energy transactions using Bitcoin and other digital assets.
“Sovereign adoption of Bitcoin is accelerating this year as demand grows for neutral payments rails that can circumvent USD sanctions,” Matthew Sigel, Head of Digital Assets Research at VanEck, told BeInCrypto.
Two weeks ago, France’s Minister of Digital Affairs proposed using the surplus production of EDF, the country’s state-owned energy giant, to mine Bitcoin.
Last week, Pakistan announced similar plans to allocate part of its surplus electricity to Bitcoin mining and AI data centers.
Meanwhile, on April 10, New Hampshire’s House passed HB302, a Bitcoin reserve bill, by a 192-179 vote, sending it to the Senate. This development makes New Hampshire the fourth state, after Arizona, Texas, and Oklahoma, to have such a bill pass a legislative chamber.
If HB302 is approved by the Senate and signed into law, the state treasurer could invest up to 10% of the general fund and other authorized funds in precious metals and specific digital assets like Bitcoin.
According to industry experts, this is only the beginning.
VanEck Predicts Bitcoin to Become a Future Reserve Asset
Sigel predicts Bitcoin will become a key medium of exchange by 2025 and, ultimately, one of the world’s reserve currencies.
His forecasts suggest Bitcoin could settle 10% of global international trade and 5% of global domestic trade. This scenario would lead to central banks holding 2.5% of their assets in BTC.
According to him, China’s recent de-dollarization will prompt other nations to follow suit and lessen their reliance on the US dollar.
“China’s de-dollarization efforts are already having second- and third-order effects that create opportunities for alternative assets like Bitcoin. When the world’s second-largest economy actively reduces its exposure to US Treasuries and promotes cross-border trade in yuan or through mechanisms like the mBridge project, it signals to other nations—especially those with strained ties to the West—that the dollar is no longer the only game in town,” Sigel said.
For Zhong Yang Chan, Head of Research at CoinGecko, these efforts could prove catastrophic for the United States’ dominance.
“Broader de-dollarization efforts by China, or other major economies, will threaten the status of the dollar’s global reserve currency status. This could have [a] profound impact on the US and its economy, as this would lead to nations reducing their holdings of US treasuries, which the US relies on to finance its national debt,” he told BeInCrypto.
However, the strength of the US dollar and other dominant currencies has already shown signs of weakening.
A General Wave of Currency Decline
Sigel’s research shows that the four strongest global currencies—the US dollar, Japanese yen, British pound, and European euro—have lost value over time, particularly in cross-border payments.
The decline of these currencies creates a void where Bitcoin can gain traction as a key alternative for international trade settlements.
“This shift isn’t purely about promoting the yuan. It’s also about minimizing vulnerability to US sanctions and the politicization of payment rails like SWIFT. That opens the door for neutral, non-sovereign assets—especially those that are digitally native, decentralized, and liquid,” Sigel added.
This lack of national allegiance also sets Bitcoin apart from traditional currencies.
Bitcoin’s Appeal: A Non-Sovereign Alternative
Unlike fiat money or central bank digital currencies (CBDCs), Bitcoin doesn’t respond to any one nation, which makes it appealing to some countries.
For Terence Kwok, CEO and Founder of Humanity Protocol, recent geopolitical tensions have heightened this belief.
For these same reasons, experts don’t expect Bitcoin to replace fiat currencies fully but rather provide a vital alternative for certain cases.
A Replacement or an Alternative?
While Bitcoin offers several advantages over traditional currencies, Gate.io’s Kevin Lee doesn’t foresee its eventual adoption causing a complete overhaul of the currency reserve system.
Recent data confirms this. The number of Bitcoin transactions has fallen significantly since the last quarter of 2024. Bitcoin registered over 610,684 transactions in November, but that number dropped to 376,369 in April, according to Glassnode data.
The number of Bitcoin active addresses paints a similar picture. In December, the network had nearly 891,623 addresses. Today, that number stands at 609,614.
Bitcoin number of active addresses. Source: Glassnode.
This decline suggests reduced demand for its blockchain in terms of transactions, usage, and adoption, meaning fewer people are actively using it for transfers, business, or Bitcoin-based applications.
Meanwhile, the Bitcoin network must also ensure its infrastructure is efficient enough to meet global demand.
Can Bitcoin Scale for Global Use?
In 2018, Lightning Labs launched the Lightning Network to reduce the cost and time required for cryptocurrency transactions. Currently, the Bitcoin network can only handle around seven transactions per second, while Visa, for example, handles around 65,000.
“If expansion solutions (such as the Lightning Network) fail to become popular, Bitcoin’s ability to process only about 7 transactions per second will be difficult to support global demand. At the same time, as Bitcoin block rewards are gradually halved, the decline in miners’ income may threaten the long-term security of the network,” Guo, Director of HashKey Research explained.
While the confluence of geopolitical shifts and Bitcoin’s inherent characteristics undeniably create a space for its increased adoption as an alternative to the US dollar and even a potential reserve asset, significant hurdles remain.
Achieving mainstream Bitcoin adoption hinges on overcoming scalability, volatility, regulatory hurdles, stablecoin competition, and ensuring network security.
The unfolding panorama suggests Bitcoin will carve out an important role in the global financial system, though a complete overhaul of established norms seems unlikely in the immediate future.
A group of veteran derivatives and FX traders in the US are launching USDi, a stablecoin designed to adjust its price in line with inflation. Its value will change regularly based on Consumer Price Index (CPI) data and the performance of Treasury Inflation-Protected Securities (TIPS).
Founder Michael Ashton aims to offer an asset that maintains purchasing power by minimizing exposure to inflation risk. However, with intense competition in the stablecoin market, USDi will need strong early traction to carve out its place.
Today, derivatives trader Michael Ashton announced USDi, a stablecoin built to fight inflation.
“The riskless asset doesn’t actually currently exist, and that’s inflation-linked cash. Holding cash is an option on future opportunities, and the cost of that option is inflation. If you create inflation-linked cash, that’s the end of the risk line,” Ashton claimed.
Investors have been using crypto to hedge against inflation for years, but USDi is a novel approach to the problem. Ashton joined two co-founders, an FX veteran, and a technical specialist, to create the firm USDi Partners LLC.
USDi is a stablecoin that is correlated with the dollar but isn’t pegged to it. Instead, it will loosely orbit the dollar, but its value will fluctuate alongside US inflation.
That prospect may seem convoluted, but a simple system defines the stablecoin’s value. Essentially, Ashton claimed that USDi would rise in accordance with regular CPI reports, calculating the total inflation since a predetermined start date.
This date is December 2024, so it’s still quite close to the dollar. Today, for example, USDi’s price is $1.00863.
The novel stablecoin is inspired by the Treasury Inflation-Protected Securities (TIPS), a government bond designed to protect against inflation. Since CPI reports only happen once per month, Ashton will adjust USDi’s price in accordance with more frequent data used by TIPS investors.
To maintain this system, Ashton will manage a fund that acts as the stablecoin’s reserves. USDi Partners will mint and burn tokens according to the daily level of inflation, plus a small transaction fee.
Only accredited investors can partake in the initial launch, but USDi Partners hasn’t announced an official release date.
In short, USDi seems like a unique approach to the crypto economy, but the stablecoin market is full of competition. Ideally, Ashton and his co-founders will be able to get some early traction to get this project off the ground.
If it proves successful, it can help demonstrate the versatility of crypto’s practical applications.
Strategy recently posted its Q1 2025 earnings report, showing over $4.2 billion in net losses despite gains on its Bitcoin holdings. Shortly afterward, the firm declared its intention to sell $84 billion in new offerings.
Shareholders’ responses are mixed, with some fearful of failing fundamentals and their own stocks being diluted. Still, this audacious plan has its supporters, with Bitcoin’s price on the rise.
Strategy’s Biggest Bitcoin Buy
Strategy (formerly MicroStrategy) hasn’t shown much interest in changing its plan for systematic Bitcoin acquisition. Its latest earnings report takes great care to show its returns on this investment: It holds 553,555 BTC, at an average cost of $68,459 each, and has gained $5.8 billion from Bitcoin.
Despite this, however, the company lost over $4.2 billion overall. The firm’s net losses are primarily due to a $5.9 billion unrealized loss on digital assets, reflecting the volatile nature of cryptocurrency investments.
Initially, the report claimed that Strategy was offering $21 billion in new stock sales to buy more Bitcoin. Soon after, however, Michael Saylor claimed that his firm was setting a much more audacious goal:
“Strategy… doubles capital plan to $42 billion equity and $42 billion fixed income to purchase bitcoin, and increases BTC Yield target from 15% to 25% and BTC $ Gain target from $10 billion to $15 billion for 2025,” Saylor said.
Compared to these figures, $84 billion in new offerings looks completely infeasible for several reasons. The main concern isn’t even finding enough buyers.
Dear MSTR shareholders, you’re getting bent.
Saylor needs to sell more common stock which he knows the shareholders won’t like. Therefore he disguises it in a “42/42” plan, despite having 20 BILLION of unsold preferred remaining from the previous plan. Why not issue it all?… https://t.co/WtUMHCt2nNpic.twitter.com/YrkztgPmVj
In other words, Strategy’s Q1 earnings report clearly shows that the firm has this reserve of preferred stock it could use to buy Bitcoin.
However, the company can’t execute these sales because of its steep losses and lack of cash flow. Offering these new shares instead would allow Saylor to gain fresh liquidity, but this would dilute existing shareholders’ holdings.
Still, some shareholders remain bullish about Strategy’s intention to buy more Bitcoin. Ultimately, the company remains a key pillar for the market’s confidence in BTC. If its investors start heading for the door, it could have adverse implications on the token’s price.
