With FTX holding a substantial amount of Solana (SOL), the altcoin may be facing challenging times ahead. Reports indicate that FTX currently possesses $1 billion worth of Solana, and recent actions by the company suggest a potential sell-off, which could significantly pressure the altcoin’s price.
Are the Bells Tolling for Solana?
As reported by The Bit Journal, the market remains uncertain, and this news has stirred concerns within the SOL market. However, experts urge caution, advising that there is no need for panic just yet. It is likely that professionals managing FTX’s asset liquidation will handle the sales through market makers. This strategy could help mitigate any harmful effects on SOL’s price.
The on-chain analytics platform Lookonchain reported that FTX/Alameda has already begun unstaking a significant amount of SOL. Lookonchain stated:
“FTX/Alameda is reclaiming over $1 billion worth of staked SOL. In the last three months, they’ve unstaked 530,000 SOL ($71 million) and transferred them to multiple addresses, unstaking an average of 176,700 SOL ($23.5 million) per month. FTX/Alameda still holds 7.06 million SOL ($945.7 million) in staked positions.”
Over $1B worth of $SOL is being unstaked by FTX/Alameda!
In the past 3 months, FTX/Alameda has unstaked 530K $SOL($71K) and transferred it to multiple addresses, averaging 176.7K $SOL($23.5M) unstaked per month.
FTX/Alameda still has 7.06M $SOL($945.7M) staked.… pic.twitter.com/lhfVDsEc99
— Lookonchain (@lookonchain) September 13, 2024
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The Potential Impact of FTX’s Moves on SOL
The liquidation process could be managed in a way that prevents sharp market declines or drastic volatility. Market makers are expected to play a crucial role in this scenario, and FTX’s liquidation is likely to be methodical and gradual, reducing the risk of flooding the market with SOL. Despite the large amount involved, the careful execution of this process may help soften the blow to the market.
There could still be some short-term price fluctuations. However, FTX’s liquidation management might contribute to some degree of stability. The preventive measures provide a level of reassurance, though traders and investors should be prepared for some volatility. For now, Solana isn’t showing a strong positive dynamic in the market. What we’re seeing in SOL might be less of an upward trend and more likely a period of liquidation rather than growth.
Will Solana Hit $150 in the Short Term? Are There Alternative Coins?
SOL’s price forecast remains bearish. According to crypto analyst Abiodun Oladokun, the negative trend surrounding SOL suggests that long-term investors may need to wait before seeing returns on their positions. At the time of writing, SOL’s Parabolic SAR indicator shows bearish signals, with dots positioned above the altcoin’s price. Additionally, the Directional Movement Index (DMI) highlights stronger negative momentum, as the -DI indicator is above the +DI indicator, signaling that SOL remains in a downtrend.
If this downward trend continues, SOL could fall below its support level of $133.64, potentially dropping to $110. However, if market sentiment turns positive, bulls could defend the support level, allowing SOL to start an upward trend towards $160.90
