Sonic crypto price surged for the second consecutive day as the network’s transactions reached the 120 million milestone.

Sonic (S) token soared to a high of $0.3555 on Thursday, up 25% from its lowest point this week. It then pared some of those gains and was trading at $0.3300 at press time.

Sonic transactions hit 120m

Sonic jumped after the developers announced that the layer-1 network crossed 120 million transactions, just six months after its launch.

While this is a notable milestone, there are signs that Sonic is losing momentum, which likely explains why its token pulled back after the initial surge.

Nansen data shows that Sonic’s transactions plunged 202% to 8.6 million in the last 30 days. At the same time, the number of active addresses on the network dropped 40% to 232,000. This slowdown occurred even as other chains like Arbitrum and Linea saw a surge in transactions.

More data shows that the Sonic ecosystem is struggling. According to DeFi Llama, the amount of stablecoin in its ecosystem fell to $209 million, the lowest level since March and well below the year-to-date high of $597 million.

Sonic’s total value locked has also been in a strong downtrend in recent months. After peaking at nearly $2 billion earlier this year, TVL has plunged to $1.2 billion.

Sonic price technical analysis

The daily chart shows that the Sonic crypto price has traded sideways in recent days. It was trading at $0.30, a few points above the year-to-date low of $0.2490.

The token has formed a descending triangle pattern, a popular bearish continuation signal. With transactions, DeFi assets, and stablecoin supply falling, there is a risk of a bearish breakdown. If this occurs, the initial target will be the all-time low of $0.2490. A move below that level would signal further downside.

On the flip side, a move above the upper side of the descending channel would confirm a bullish breakout and point to more gains.