Solana's Price Declines 20% Amid FTX/Alameda, Pump Selling

Solana ($SOL), a top-performing cryptocurrency, has recently faced significant selling pressure from two major market players: FTX/Alameda and an entity known as the “pump”. This selling pressure has led to a decline in the price of SOL and increased its volatility, making it difficult to trade in the short term and hold in the long term.

FTX/Alameda has been a consistent seller of Solana for the past 18 months, having sold a total of 8.031 million SOL since November 2022. This amounts to approximately $1.03 billion at current prices. The selling has been so predictable that it occurs around the 10th of every month, with approximately 180,000 SOL being sold or transferred. This consistent selling has had a bearish impact on Solana's price, with the price declines over the same period being directly linked to FTX/Alameda's sales.

Another key player contributing to the selling pressure on Solana is the “pump”. This entity has been active in the market since the beginning of 2024, unloading a total of 3.403 million SOL worth approximately $629 million over the past year. Unlike FTX/Alameda, the “pump” has a more erratic selling pattern, typically occurring once every 1 to 2 weeks, with roughly 100,000 SOL being sold each time. The frequent and large sales by the “pump” have made Solana's price very unstable, with each sale putting downward pressure on the price.

The combined selling from FTX/Alameda and the “pump” raises serious questions about Solana's price trajectory. Even with these assets offloaded, it is hard to see how Solana could be anything other than a prime candidate for long-term price devaluation. The continued selling from FTX/Alameda is especially significant as it has been taking place since the collapse of FTX in late 2022. The duration and end of this selling are unknown, and it remains a natural weight on Solana's price.

The “pump” adds another layer of complexity to the situation with its unpredictable selling behavior. This could keep the market from establishing a clear near-term bullish or bearish tendency. Despite these challenges, Solana shows resilience with its low fees, high transaction capacity, and potential for future scalability. The increasing number of partnerships and the growing adoption of its blockchain technologies could lead to a revival in the DeFi space.

In conclusion, the price movement of Solana will not only be influenced by these key selling pressures but also by the overall market sentiment, investor feelings, technological developments, and regulatory decisions. As the blockchain ecosystem evolves, these factors will be crucial for investors to monitor.