Solana (SOL) Faces Sharp Decline Amid Market Uncertainty
Solana (SOL) is experiencing a significant downturn, with its price dropping 10% in the past 24 hours to $164.2 as of Monday morning. Over the past week, the token has plunged 19%, raising concerns among investors about what’s driving this steep decline.
Why Is Solana (SOL) Dropping?
One of the key factors impacting SOL’s price is the repayment process by FXT, the crypto exchange that collapsed in 2022. FXT has begun repaying its creditors—both institutional and retail—starting with those who held $50,000 or less. These repayments are being made in cryptocurrencies, adding fresh liquidity to the market and possibly increasing sell pressure.
Another major concern is the upcoming unlocking of 11.2 million SOL tokens, valued at approximately $2.06 billion, scheduled for March 1, 2025. Market analysts worry that this influx of tokens could flood the market, causing further price declines.
What Analysts Are Saying
Experts warn that despite Solana’s $100 billion market cap, it doesn’t guarantee enough liquidity to absorb a sudden surge in supply.
“Solana’s market cap may be around $100 billion, but that doesn’t mean there’s enough liquidity to absorb a massive sell-off. If they decide to dump, the price could take a serious hit,” one analyst cautioned.
What’s Next for Solana?
As investors brace for potential volatility, all eyes are on how the market will react to this increased supply. Will Solana recover, or will further declines follow? The coming months will be crucial in determining the token’s long-term trajectory.
Stay tuned for more updates as the situation unfolds.
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