Solayer Token Faces $350 Million Market Loss Ahead of Major Token Unlock

Solayer’s token has experienced a significant drop, losing over $350 million in market value as investors prepare for a major token unlock. The token price has fallen nearly 35% in the past 24 hours, currently trading at $1.75. This represents a decline of 47.8% from its all-time high of $3.39 recorded on May 5. Trading activity has surged in response to the price drop, with over $1.26 billion in LAYER tokens exchanged over the last day—a remarkable 179% increase in trading volume.

Investor Concerns Over Token Unlock

The sharp decline appears to be driven by growing concerns surrounding an upcoming token unlock scheduled for May 11. This unlock will release over 27 million tokens, accounting for nearly 13% of the total supply and valued at approximately $46.7 million. The influx of new tokens is expected to put additional selling pressure on the market. Furthermore, the event will initiate a long-term vesting plan, with new tokens issued every three months to the Solayer foundation until 2030.

Whale Activity and Market Manipulation Allegations

Data also suggests that a whale exited their position during Asian trading hours, potentially exacerbating the token’s decline. On May 6, one user on X alleged that the wallet strategically opened a large short position via perpetual futures, driving funding rates negative before gradually selling off their long position. This move was described as a “scam exit,” sparking heated discussions within the community:

“$LAYER (Solayer) – the scam exit happening in real-time. Looks like the large supply holder is making a quiet exit today during Asia session, 5 days ahead of unlock. Built a massive short via perp, pushing funding down. Slowly unwinding spot long. The gig is up.”

Some users claim the trader employed a calculated strategy involving over-the-counter token sales and leveraged short positions to profit despite the crash.

Market Outlook and Volatility

Following the recent decline, Solayer has reversed much of its previous gains, wiping out nearly 460% growth achieved between February and early May. Many investors have expressed surprise at the speed of the price drop. The long/short ratio has flipped to 1.45, indicating that some traders anticipate a potential recovery. However, market volatility remains high, and fears of further losses persist.

Solayer Project Fundamentals

Despite the market turbulence, the Solayer team maintains confidence in the project’s fundamentals. Solayer is a hardware-accelerated blockchain designed to achieve speeds exceeding one million transactions per second. Additionally, the Solayer Emerald Card allows users to spend USD Coin (USDC) via Visa, with compatibility for Apple Pay and Google Pay.

While the current price action raises questions about short-term stability, the long-term vision of Solayer continues to attract interest from cryptocurrency enthusiasts and investors.

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