FTX’s ongoing bankruptcy proceedings have once again placed Solana (SOL) under the spotlight, as wallets tied to the exchange and its affiliate, Alameda Research, received a massive influx of over 3 million SOL tokens worth $430 million. The transfer has sparked concerns over potential selloffs, which could place further pressure on Solana’s price.
Massive Transfer to FTX Wallets
According to Arkham Intelligence, the FTX and Alameda wallets received two separate tranches of Solana from an anonymous wallet. The first tranche involved 1.93 million SOL, valued at around $305.7 million, while the second tranche contained 1.1 million SOL, worth approximately $174.8 million. These funds were transferred with minimal fees and are now part of the FTX estate.
Despite the anonymity of the wallet’s origin, the transfer has raised concerns within the crypto industry, with many speculating on whether the FTX estate will liquidate this new stash of SOL to pay off creditors.
Solana Price Under Pressure
The market’s focus is squarely on the potential impact of this transfer on Solana’s price. At the time of writing, SOL was trading at $140.88, marking a 19.46% drop in just 24 hours. This decline comes amid a broader market downturn, and Solana has now fallen over 52% from its all-time high of $294.33.
FTX’s ongoing liquidation plans further complicate Solana’s market outlook. The exchange had previously signaled plans to liquidate up to $27 million worth of SOL, adding to the downward pressure. With more payouts expected in April, the potential for further market disruption remains high.
Is Solana Facing More Volatility?
While the ongoing selloff concerns weigh heavily on Solana’s price, some analysts remain optimistic. VanEck, for instance, has predicted that SOL could reach $520 by the end of this year, driven by growth in decentralized finance (DeFi) applications and the memecoin ecosystem.
A key factor that could help stabilize Solana’s price is the growing interest in a Solana exchange-traded fund (ETF). If approved by the U.S. Securities and Exchange Commission (SEC), such a product could lead to significant institutional adoption, offering a potential boost to Solana’s value.
What’s Next for Solana?
For now, the immediate outlook for Solana remains uncertain, with FTX’s liquidation activities continuing to influence the price. Investors will need to monitor developments closely, especially the upcoming payouts and any regulatory changes around a Solana ETF. The coming weeks could determine whether Solana can weather this storm or face further price declines.
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