Solana Woes Deepen as FTX Set to Unlock 11.2M SOL on March 1
Market sentiments around the Solana ecosystem have further soured, with FTX set to unlock over 11 million SOL, worth nearly $2 billion, next month.The Solana ecosystem has been under intense pressure recently as the meme coin fiasco in the network escalates. Reports of insider trading and collaborations to defraud investors have been trending, heightening negative bias.For perspective, tongues started wagging after the LIBRA token saga involving Argentina President Javier Milei. To add to the skepticism, the decentralized exchange aggregator Jupiter admitted to the foreknowledge of the tokens launch, confirming a perfectly staged rug pull.While the rumble negatively impacts social sentiments and prices, another possible setback has emerged for Solana. Notably, the bankruptcy estate of the defunct exchange FTX has disclosed plans to unlock 11.2 million SOL, increasing the coin's circulating supply.Solana Faces Unlock Worth 8% of Circulating SupplyWith FTX repayment resuming yesterday, creditors with under $50,000 in the exchange before its collapse have received up to $1.2 billion. Meanwhile, the bankruptcy exchange will unlock 11.2 billion SOL on March 1, which it sold at auction to repay customers.https://twitter.com/ai_9684xtpa/status/1891382826416898526The unlock follows the FTX estate's 41 billion SOL sales after the famous November 2022 collapse. The exchange sold these tokens at a discounted price to top companies like Galaxy, Pantera, and Figure.For context, Galaxy bought 25 million SOL at $64 each, Pantera 13.67 million SOL at $95, and Figure 1.8 million at $102. This means they have 165%, 79%, and 66% profits on their Solana holdings, respectively.Impact on Price?Meanwhile, there is growing speculation that Galaxy and these other firms will liquidate these assets upon unlock, neutralizing demand with fresh supply. An analyst suggests that buying Solana is dangerous amid the burgeoning skepticism around the ecosystem. Also, the likelihood of price downsides means these firms have nothing stopping them from selling the 41 million SOL.If these sentiments persist, Solana could see lower prices, with technicals aligning with the bearish outlook. The asset has already broken down from a multi-month ascending triangle, invalidating bullish outlooks.Further, Ali Martinezs analysis shows Solana's next target is the 0.382 Fibonacci level at $165. At the time of writing, the asset trades at $168.58, down 10% in the past week.
Text source: The Crypto Basic
