FTX is currently unwinding its significant Solana (SOL) holdings, with reports indicating that the bankrupt exchange still has over $1 billion worth of these tokens to sell. This large volume could put downward pressure on Solana’s market valuation as on-chain data shows declining interest in the network.
Blockchain analytics firm LookOnChain reports that FTX and Alameda Research have already unstaked significant portions of their Solana tokens. Over the past three months, 530,000 SOL were unstaked, valued at $71,000, with monthly averages reaching 176,700 SOL or $23.5 million. Despite these transactions, 7.06 million SOL, worth $945.7 million, remains staked.
FTX had a notably strong relationship with Solana before its collapse in November 2022. Following the exchange’s demise, SOL prices dropped sharply to as low as $8, contributing to volatility in the broader cryptocurrency market. The company has been gradually selling its Solana assets since then, possibly conducting some sales over-the-counter (OTC) to minimize market impact.
The ongoing liquidation of FTX’s crypto assets is occurring amid increased scrutiny from federal authorities. Caroline Ellison, former CEO of Alameda, will face sentencing on September 24 for her role in the exchange’s collapse. She has accepted all charges against her as part of a plea deal.
Despite this, Solana has seen a decline in on-chain activity. Last week, the network recorded a six-month low in weekly decentralized exchange (DEX) volumes at $7.7 billion, significantly lower than its previous high in March.
From a technical standpoint, Solana’s price is at a critical juncture. Currently trading near $127 after losing its 200-day exponential moving average (EMA) support, analysts warn that a drop below $126 could result in further losses, potentially bringing the price down between $92 and $110.
FTX's continued liquidation of its Solana tokens means that market participants are staying vigilant, awaiting the next developments in this ongoing saga.
