Solana price unbound by FTX-induced sell pressure

September 14, 2023 01:32 PM PDT | By Invezz

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Solana price unbound by FTX-induced sell pressure — Image source: Invezz

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After the Delaware Bankruptcy Court authorized the sale of FTX’s digital assets, which include 55.75 million Solana (SOL) valued at $1.062 million, the price of SOL came under intense selling pressure. The unlock timeline of FTX’s holdings and derivative market positioning, however, point to the possibility of an upside-biased countermove.

On September 13, following the decision during a hearing before Judge John Dorsey, the price of SOL fell to a weekly low of $17.96.

However, according to data from CoinGlass, the SOL price increased by almost 4% on September 14 due to the liquidation of long positions worth $800,000.

MartyParty, a cryptocurrency trader, thinks the selling pressure is exaggerated because the majority of FTX’s SOL holding is vesting between 2025 and 2027.

This is Alamedas Solana wallet which has the rights to the 26,740,743 staked $SOL from 2025-2028.

This wallets keys will be sold in the FTX liquidation. Not the $SOL which cannot be unlocked until 2025-2028.

As Ive been posting for weeks – FTX/Alameda only hold 7m $SOL and… pic.twitter.com/WeIkCKf2Ek
— MartyParty (@martypartymusic) September 13, 2023

Additionally, after the liquidation allegations surfaced, traders in derivatives piled on with short bets, which, according to analysts might lead to a countermove to the upside.

After FTX’s demise, the Solana Foundation published an update of its Solana holdings, which revealed that some of the SOL tokens held by the collapsed FTX exchange were locked until 2027. According to the schedule, another 33 million SOL tokens were yet to be activated

Solana’s association with Sam Bankman Fried

Sam Bankman Fried, the creator of the now-bankrupt cryptocurrency exchange FTX and the hedge fund Alameda Research, has long been linked to Solana (SOL). During the bull market of 2020–2021, he made multiple investments in various businesses using the Solana ecosystem and was also an early investor in the blockchain.

Solana and other “Sam coins” consequently suffered a severe decline when FTX collapsed before the end of 2022, plummeting to lows of $9.89, down 96.3% from the height of $259.96.

Since the beginning of 2023, Solana’s price has recovered, rising 175% to a high of $27.37 as the ecosystem expanded.

The post Solana price unbound by FTX-induced sell pressure appeared first on Invezz.

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