Solana’s Price Plummeted to October Lows Amidst Rising Selling Pressure Ahead of 11.2M SOL Unlock
Solana has experienced a significant downturn, reaching its lowest point since November, as selling pressure increases in anticipation of a major token unlock.
As of this moment, Solana (SOL) is trading at the $135 level, reflecting a 15% decrease in just one day. Over the past week and month, it has recorded declines of 17% and 56% respectively, as reported by crypto.news.
This represents Solana’s lowest price since mid-October. Notably, the price drop occurs despite an uptick in institutional interest in SOL, with firms like Franklin Templeton and VanEck recently submitting applications for Solana exchange-traded funds.
The decline in Solana’s price can be linked to various factors, primarily the broader market sell-off, which has seen over $325 billion erased from the crypto market capitalization since Friday. While Bitcoin (BTC) has experienced a relatively modest decline, altcoins have suffered more significantly, with Solana being one of the hardest hit among the top 10 cryptocurrencies by market cap.
In addition to the market-wide liquidations, the volatility in SOL’s price can also be attributed to a decrease in demand for meme coins following the Libra controversy, which had previously driven much of Solana’s activity earlier this year.
Looking forward, the prospects for SOL’s price appear grim. Recently, crypto market maker Wintermute withdrew over $38 million worth of SOL from Binance. This action precedes the largest $2 billion SOL token unlock event set for March 1, which will flood the market with over 11.2 million SOL tokens. The withdrawal may indicate that Wintermute anticipates the upcoming token unlock will contribute to even greater downward pressure on Solana’s price.
https://twitter.com/solidintel_x/status/1893960265181360329
In a recent update on X, crypto analyst Artchick.eth highlighted that over the next three months, more than 15 million SOL—worth around $2.5 billion—will become available in the market. Many of these tokens were bought at $64 per SOL during FTX’s auction by firms such as Galaxy Digital, Pantera Capital, and Figure. There is growing concern that these firms are likely to sell their holdings, as the incentive to retain SOL diminishes amid deteriorating market conditions.
https://twitter.com/digitalartchick/status/1891195013763383298
From a technical perspective, Solana is currently in a pronounced downtrend, trading significantly below its 50-day (196.38) and 200-day (198.63) Weighted Moving Averages. A death cross is forming, as the 50-day WMA drops below the 200-day WMA, suggesting further downside potential.
In terms of structural support levels, key areas to monitor are around $130-$140, with a possible drop to $120 if this threshold is breached. Resistance levels lie between $160-$180, correlating with previous consolidation zones.
In summary, Solana’s steep decline is primarily driven by the approaching token unlock, which will unleash over 11.2 million SOL into the market. With Wintermute withdrawing a substantial amount of SOL, the selling pressure continues to rise.
Nonetheless, the sharp and aggressive sell-off has pushed SOL into oversold territory, which could facilitate a short-term relief bounce. If sellers tire and buyers engage at key support levels, a temporary rebound may be feasible. However, for any sustained recovery, SOL must reclaim resistance above $160 to shift market sentiment in a more favorable direction.