Solana (SOL), an established blockchain platform celebrated for its high throughput and low transaction costs, has been encountering significant challenges of late.
The emergence of meme coins—especially the highly contentious rug pull associated with the LIBRA token—has only compounded investor concerns regarding SOL’s overall health. As a direct consequence, Solana’s price has been declining, and it is now down by 10% just over the past week, with a stunning 40% extraction from its zenith in January.
This recent drop is part of a larger trend affecting decentralized exchanges (DEXs), which are seeing weakened trading volumes. Solana’s main DEX, Raydium, demonstrated a large 47% decrease in activity just last week. These two trends are not good for Solana—which is also struggling to recover from the bearish sentiment that has plagued the whole crypto market for the last couple of months—because they show not only that Solana’s DEXs are losing traders, but also that Solana itself is losing traders.
FTX Unlock Event: A $2.06 Billion Challenge
Solana’s troubles could soon deepen with the scheduled unlocking of 11.2 million SOL tokens on March 1, 2025. These tokens were sold off during the FTX bankruptcy auction and have since been acquired by large investors like Galaxy, Pantera, and Figure. Could those tokens coming back to market in a few years have a serious impact on SOL’s price? The folks at CoinMarketCap seem to think so and have included this potential scenario in the “causes of concern” part of Solana’s narrative.
The 11.2 million SOL that are set to be unlocked have a current market value of around $2.06 billion. This is a massive amount of coins to suddenly introduce into the market, and it’s a safe bet that the people who bought the SOL at the FTX auction will be looking to sell. And sell they might, considering the current SOL price is half of what it was back in September. Still, the 11.2 million SOL hitting the market will have some immediate effects that are definitely not positive for the SOL price in the short term.
After FTX declared bankruptcy, it auctioned off 41 million SOL tokens. Who actually bought those tokens, and at what prices, gives us a small glimpse into market sentiment:
1. The largest buyer that emerged was Galaxy, obtaining a massive 25.52 million SOL at an average price of $64. This purchase has already played out quite nicely for them, with Galaxy now sitting on a 187% return rate on their investment.
2. Buyers like Pantera secured 13.67 million SOL at an auction price of $95. With a return rate of 93%, these buyers are also in the black, but their gains aren’t quite as sizable as those racked up by Galaxy.
3. At $102 per token, Figure and other buyers acquired 1.8 million SOL. Their current return rate is 80%, which, while still profitable, is lower than the return rate of Galaxy and Pantera’s investors.
FTX 破产拍卖的 1120 万枚 $SOL 将在 03/01 解锁，价值 20.6 亿美金🚨
FTX 曾在三次拍卖中出售 4100 万枚 SOL，TOP3 买家和拍卖价格如下
1️⃣Galaxy：$64 买入 2552 万枚，回报率 187%
2️⃣Pantera 及其他买家：$95 买入 1367 万枚，回报率 93%
3️⃣Figure 及其他买家：$102 买入 180 万枚，回报率 80% https://t.co/iPhqiR715C pic.twitter.com/sNvxXspz0S— Ai 姨 (@ai_9684xtpa) February 17, 2025
The tokens of such large stockholders of SOL are about to be unlocked. Consequently, this may result in a big influx of selling pressure for: 1. the SOL market, and 2. the overall crypto market. Why? Because those large stockholders can really only be described as “whales.” And when whales decide to sell, they usually do it in a way that creates a lot of “fishing pole” effects.
The Impact of Meme Coins and DEX Decline
In addition to the upcoming token unlock, Solana’s recent price slump can be attributed to two other factors: the increasing popularity of meme coins and the LIBRA rug pull. Solana is decidedly not a meme coin—it has a functioning blockchain with a diverse range of over 400 projects. But while Solana’s developers are hard at work trying to bring real utility to the network, meme coins like $PEPE are attracting the attention of retail traders who are plowing their money into these largely meaningless tokens. On top of this, the recent collapse of a supposed stablecoin, LIBRA, has opened many investors’ eyes to the volatility of the coin market and to the dangers of investing in it.
The drop in DEX trading volume, especially on Raydium, is another dark cloud on the horizon. Once a major platform for decentralized trading on Solana, Raydium has seen a severe 47% drop in trading volume over the past week. This drop is tied to and reflects a number of ongoing problems with Solana, including a drop in “Solana DApp” usage (DApps are “decentralized applications” that run on a blockchain) and user engagement on Solana DEXs.
These factors acting together have made Solana’s standing in the market precarious. It has technological strengths; high-speed transactions and low fees are two of them. But on the other hand, the platform is facing other blockchain systems that are also quite competitive, and it seems to be struggling to maintain the growth levels of earlier in 2025.
Looking Ahead: Navigating Uncertainty
As the unlocking event on March 1 approaches, participants in the market for Solana (SOL) will watch closely to see what happens to the price of SOL in the wake of a fresh infusion of newly unlocked tokens. How much price pressure the newly unlocked tokens might apply in the short term is a matter of some speculation. Long-term investors in Solana will likely remain focused on the fundamentals of the Solana ecosystem and its prospects for recovery in 2023 and beyond.
Investor confidence will return to Solana only when it comprehensively resolves the meme-coin challenge, deals with the impending decline in DEX trading volumes, and addresses the FTX token unlock issue. Revving up the ecosystem, ensuring that SBF’s favorite sandcastle has a future, and finding partners who will build in Solana’s world will be job one for the Solana Foundation and its supporters.
To sum up, the future looks murky for Solana, but the platform still has a chance to get back on its feet. As for the price, in the weeks ahead, it could go up or down a lot, which is why investors should keep a close eye on it and the media for any major developments.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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