Solana’s price may soon decline due to selling pressure stemming from a court ruling allowing the bankrupt cryptocurrency exchange FTX to liquidate billions in assets. This includes large holdings of Solana as well as Bitcoin, Ethereum, and other cryptocurrencies.
Solana is currently trading within a descending channel and facing resistance around $18.42. If bullish momentum falters, the price could break below support at $17.34 and fall towards the $16 range, marking a 12% drop. However, some investors appear to be accumulating on the weakness which could propel Solana above channel resistance.
Data shows FTX held over $1 billion in Solana as of August 31, making it a major holder. The court approval to sell assets is bearish for Solana, though much of FTX’s holdings are locked until 2028. Still, steady selling by such a large holder could continue weighing on Solana’s price, unless an over-the-counter deal emerges.
On Wednesday, the court allowed FTX to liquidate $3.4 billion in crypto assets including Solana, Bitcoin, and Ethereum. Sales will be capped at $50-200 million per week. Some argue that FTX did not single-handedly support Solana’s price, though its collapse preceded an enormous drop in Solana’s market capitalization. Ultimately, absorbing $3.4 billion in sales presents meaningful downside risk.
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