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Solana Price Plunges to Lowest Level Since Mid-October Amid FTX Token Unlock Concerns
Solana’s price has plummeted to $126, its lowest point since mid-October, as investors prepare for the upcoming 11.2 million SOL token unlock from the FTX bankruptcy estate. This development has sparked concerns over additional selling pressure in the market.
Market Performance and Selling Pressure
According to recent market data, Solana has experienced a significant drop of 9% in the last 24 hours and 27% over the past week. The cryptocurrency’s price decline is largely attributed to the growing concerns over the potential sell-off of SOL tokens. FTX, a major holder of Solana, has been selling off assets to repay creditors as part of its bankruptcy process.
So far, 41 million SOL tokens have been sold to firms like Galaxy Digital, Pantera Capital, and Figure. The next scheduled unlock on March 1, totaling 11.2 million SOL tokens or around $1.3 billion at current prices, has raised fears of a possible sell-off, adding downward pressure on SOL in an already weak market.
Decline in Decentralized Finance Landscape and Demand
Activity on Solana’s decentralized finance landscape has declined significantly, with the network’s total value locked dropping from $12 billion in mid-January to $6.8 billion on February 28. Additionally, the demand for SOL has also reduced due to the recent downturn in memecoin trading, which once fueled huge trading volumes.
Technical Analysis and Downside Risk
According to technical indicators, there is more downside risk for Solana. The cryptocurrency has broken below the crucial support level of $127, with the next significant levels at $110 and $100. Although the relative strength index is at 23.92, indicating severe oversold conditions, this does not always signal an immediate bounce.
Bollinger Bands display massive volatility, but red candles continue to dominate trading activity, suggesting strong selling pressure. SOL might move toward the $110–$100 range if it continues to break below $127, but if momentum changes, it might recover to the $150–$166 range.
Open Interest in Solana Futures and Institutional Firms
Data indicates that open interest in Solana futures has drastically decreased, from $7.4 billion in mid-January to $3.7 billion on February 28. This suggests that leveraged positions have been significantly reduced.
Although institutional firms such as VanEck and Franklin Templeton have filed for Solana ETFs, there are still no immediate catalysts as ETF approvals might take some time. If SOL fails to reclaim $130, the downtrend may accelerate, putting the $100 level in focus.
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