Last week, BeInCrypto’s technical and on-chain analysis predicted that Bonk (BONK) was looking to reach $0.000025. But that was not the end, as the meme coin went further and surpassed the prediction.

Amid its recent increase, something else has happened, and a deeper analysis hints at a surprising revelation.

Volatility Rises as the Solana Meme Coin Overtakes FLOKI 

According to CoinGecko, Bonk’s market cap was about $1.49 billion on July 1. Around the same time, Floki (FLOKI), another meme coin, had a market cap of $1.62 billion. Fast forward to today, things changed, as BONK’s market cap hit $1.73 billion while FLOKI’s was lower at $1.70.

The rise in the market cap can be linked to BONK’s price performance since the market cap is a product of price and circulating supply. At press time, the price has increased by 10.50% in the last 24 hours. 

This is higher than FLOKI, which is a 3.58% hike. Following the price increase, Santiment data shows that volatility around BONK has spiked. Specifically, the on-chain analytic platform put the one-day volatility at 0.042.

Volatility indicates how quickly prices can move within a short period of time. If accompanied by buying pressure, high volatility can help the value of a token surge to incredible levels. 

However, if selling pressure is intense during high volatility, the price can crater in a flash. In BONK’s case, the price may continue to jump if buyers do not rest on their oars.

BONK Price Prediction: Is the Corrective Phase Over?

Furthermore, the daily chart shows an inverse Head and Shoulder (H&S) pattern formation. Typically, a regular H&S pattern displays three successive peaks. One is in the middle (head), and the two are outside peaks (shoulders) at each end.

If this were the case, it would have marked the end of BONK’s uptrend as it is bullish-to-bearish. However, since the pattern is inverse, it means that the trend is bearish-to-bullish. Therefore, BONK’s price may reach head toward $0.000031 if buyers decide to sustain the momentum.

Likewise, the Parabolic Stop-and-Reversal (SAR) supports the potential uptrend. The SAR is a technical tool used to predict a crypto’s short-term momentum.

Read More: 11 Top Solana Meme Coins to Watch in July 2024

When the dotted line is below the price, it means that the price can reverse downward. But for the token, the dotted lines are below it. If this stays the same over the coming days, the meme coin upswing may be validated.

In addition, the Relative Strength Index (RSI) reading increased. The RSI measures momentum using the magnitude of price changes. When it increases, it means the momentum is bullish, and a decrease implies that the momentum is getting bearish.

The RSI on BONK’s daily chart is 53.62, indicating that buyers are dominant. If this continues, BONK will hit $0.000028 and then move to $0.000031. 

However, the token will be overbought if the RSI reading reaches 70.00 or above. Should this be the case, BONK may reverse to $0.000023.

Dan Gallagher is the proposed next Chair of the US Securities and Exchange Commission (SEC) in a prospective Donald Trump administration. The former agency commission welcomed his selection.

The shared sentiment is that with a Republican in office, crypto would enjoy a more favorable regulatory environment, with key commission members calling it out for problematic laws.

Crypto Investors Want Dan Gallagher for SEC Chair

Gallagher served as SEC commissioner during the tenure of former US President Barack Obama. Welcoming his selection, Gallagher said he would promote access to the markets while ensuring the US remains at the forefront of financial innovation.

Before this nomination, Hester Pierce, alias Crypto Mom, had been the likely successor in case a Republican administration took office. Her name was floated around multiple times ahead of the spot Bitcoin ETFs approval.

In September, John Reed Stark, formerly an official with the SEC’s internet office, highlighted Pierce’s name. Her lengthy track record of dissent and opposition to most crypto-related SEC actions made her the ideal candidate.

“Should a Republican get elected President, Chair Gensler would likely resign and the senior Republican appointed SEC Commissioner (in this case famed “crypto-mom” Hester Peirce) would possibly become acting Chair,” Reed Stark explained.

Read more: Crypto Regulation: What Are the Benefits and Drawbacks?

Notably, no more than three out of five Commissioners may belong to the same political party. This prevents partisan issues within the SEC. The President designates one of the Commissioners as the agency’s top executive when the current Chair resigns.

Popular belief is that a Republican taking office after the November elections would bode well for crypto. Expectations include the SEC’s crypto enforcement efforts to be reduced significantly, potentially focusing on fraud cases. This is as opposed to charging pure registration violations like crypto trading platforms failing to register as an exchange, broker-dealer, and clearing firm.

Another possible expectation is that the agency would be more open to taking significant crypto-friendly regulatory actions, such as approving more spot ETFs to give investors exposure to more financial instruments.

Under President Joe Biden’s administration, the current US SEC is said to be biased against crypto, as Democrats hold the majority. Besides Pierce, Commissioner Mark Uyeda is the only other Republican within the SEC.

Mark Uyeda Calls Out US SEC for Problematic Rules

Like Pierce, Commissioner Uyeda has also sided with the industry, criticizing the SEC’s approach to crypto disclosure rules as “problematic.”  He says Form S-1 filings need updates as they neither facilitate capital formation nor protect investors in their current state.

“The Commission should take steps to ensure that registration statement disclosure is material and informative to prospective purchasers. By the same token, the Commission should avoid requiring disclosures that are irrelevant and distract readers from the important information,” Uyeda wrote.

The critique comes after the financial regulator returned Ethereum ETF S-1 forms to issuers, calling for changes and instructing them to refile by July 8. The action suggests at least one more round of filings before the Ethereum spot ETFs can launch. Head of Government Affairs at Paradigm Alexander Grieve lauded Commissioner Uyeda, underscoring the significance of his statement.

“First time AFAIK Uyeda has been on record calling for a tailored disclosure regime for crypto assets. The SEC under a different admin would be a very different place,” Grieve remarked.

While the market anticipates the ETH ETFs will begin trading on July 4, the timeline hinges on how fast the SEC can review and respond to the issuers’ filings.

Read more: How to Invest in Ethereum ETFs?

Meanwhile, the SEC continues to clamp down on crypto firms. In a post on X, Binance.US highlighted a prolonged legal battle with the regulator. The trading platform expressed its commitment to compliance and criticized the agency’s enforcement tactics.

“On Friday, the Court decided that the SEC’s case against Binance.US will continue. We were prepared for this and look forward to having this case move forward in the judicial process,” read the announcement.

The case concerns securities law violations, offering unregistered investment products, and violating anti-fraud laws. As it prepares for the showdown, Binance.US slammed the SEC’s “regulation by enforcement,” calling out SEC Chair Gary Gensler for being politically motivated.

Crypto data platform Kaiko recently reported that the introduction of spot Solana exchange-traded funds (ETFs) did not significantly impact the market.

Despite initial enthusiasm and a brief price spike, Solana’s (SOL) market dynamics quickly returned to their prior state, reflecting skepticism and regulatory challenges.

Solana’s Brief Surge: Investor Hopes Fade Quickly Despite ETF News

On June 27, VanEck filed for the first spot Solana ETF with the US Securities and Exchange Commission (SEC). A similar filing from 21Shares followed on June 28.

These filings initially generated excitement, causing Solana’s price to spike by 6%. However, Kaiko reveals the impact was fleeting, and market dynamics soon returned to their previous state.

Read more: Crypto ETN vs. Crypto ETF: What Is the Difference?

“The filings provided a temporary boost to market sentiment, which had been dampened by fears of a broad selloff due to Mt. Gox repayments,” the report reads.

This temporary shift was reflected in Solana’s cumulative volume delta (CVD) data, which measures cryptocurrencies’ net buying and selling. According to Kaiko, Solana recorded a net positive CVD of $29 million over the past week, primarily driven by increased spot buying on Coinbase.

Furthermore, Kaiko’s analysis suggests that investor expectations for spot Solana ETF were not as high as for other cryptocurrencies like Ethereum (ETH). Solana, often called an ‘Ethereum killer,’ struggled to maintain its momentum.

A comparative analysis with Ethereum highlighted this discrepancy. After spot Ethereum ETF received partial approval on May 23, its price showed a more sustained upward trend than Solana.

Kaiko also noted that the effect of the Solana ETF news on the derivatives market was limited. While there was a brief spike in the volume-weighted funding ratio of the SOL token on June 27, it soon returned to neutral levels. Open interest remained virtually unchanged and was 20% lower than its early June levels, underscoring the lack of sustained bullish demand.

Solana Ecosystem Continues to Expand Amid Regulatory Doubts

One possible explanation for the muted market reaction could be skepticism regarding the approval odds of a spot Solana ETF. Unlike Bitcoin and Ethereum, Solana has less data accumulated in the derivatives market, making it challenging to convince regulators about its price stability and resistance to manipulation. 

Kaiko cited these regulatory hurdles as a significant factor. Industry experts share Kaiko’s cautious outlook. ETF analyst James Seyffart from Bloomberg Intelligence noted that Solana’s status as a security could significantly hinder the approval process.

“Solana’s classification as a security presents a very rocky road for ETF approval,” Seyffart remarked.

Despite the challenges, there are positive developments within the Solana ecosystem. Data from the crypto exchange Bitget report shows that Solana’s decentralized finance (DeFi) ecosystem has experienced rapid growth, with its total value locked (TVL) rising from approximately $1.3 billion at the beginning of 2024 to about $4.5 billion at the end of June.

The Solana Foundation also continues to innovate. It recently expanded its ecosystem to include Solana mobile phones, SDKs, and the newly launched Solana Blinks.

“These products lay the foundation for Solana’s mass adoption, represent Solana’s adaptation to mobile internet development, and are key to the constant increase in active addresses on the chain,” Ryan Lee, Chief Analyst at Bitget Research, told BeInCrypto.

Read more: What Is Solana (SOL)?

Nonetheless, the Solana ecosystem’s continuous growth and innovation lay the groundwork for potential future success. Additionally, as regulatory conditions change, Solana’s prospects may improve.