Solana Price Falls Amid Bearish Momentum and Validator Decline

• Solana (SOL) is currently trading below key moving averages and facing bearish pressure, with resistance at $116 and support at $120. According to TradingView analysis
• Institutional adoption by companies like Visa and PayPal continues, but validator participation has declined to the lowest level since August 2021.
• Network upgrades like Alpenglow and Firedancer have improved Solana's performance, with a TVL of $10.2 billion and 17,708 active developers. As reported

Solana's price action in late 2025 painted a bearish picture as the token fell below the critical $135 support level, consolidating below $130 and forming a bearish trend line with resistance at $136. This breakdown below the 100-hourly simple moving average (SMA) signaled a shift in momentum, with analysts warning of further declines toward $122 or even $120 if the $130 level failed to hold.

Despite the bearish price action, Solana's decentralized exchange (DEX) volume remained robust, with $1.6 trillion in trading volume in 2025. This surge outpaced centralized exchanges like Bybit and Coinbase, underscoring Solana's growing role as a hub for decentralized liquidity. However, despite this volume, the price of SOL stagnated near $126, highlighting a disconnect between trading activity and valuation.

Meanwhile, Solana ETFs have continued to attract capital, with a seven-day inflow streak totaling $674 million in early 2026. This institutional demand suggests that long-term investors remain confident in Solana's fundamentals, even as retail traders on DEXs grapple with volatility. The coexistence of these two dynamics—high DEX volume and strong ETF inflows—points to a market split between speculative trading and strategic accumulation.

What Is Driving Solana's Price Decline?

The recent price drop for Solana has been attributed to a combination of bearish technical indicators and broader market dynamics. Solana is trading at $113.25, significantly below MA-20 ($133.05), MA-50 ($130.49), and MA-200 ($170.94), indicating pronounced bearish pressure. Momentum indicators like MACD, ADX, and CCI reinforce the bearish bias.

The drop in validator count to 800 has raised concerns about decentralization and network security. Smaller operators are being priced out due to rising costs and fee competition, leading to a concentration of staking power among large operators and institutional players.

What Could Stabilize Solana's Price?

Despite the decline, Solana has maintained strong fundamentals, including high DEX volume, ETF inflows, and network upgrades. The $135 support level remains crucial in determining Solana's short-term trajectory. A successful defense of this level could signal a broader bullish rebound, with potential for a $140+ rebound.

Solana's ecosystem fundamentals have also helped stabilize prices at key support levels. Developers continue to build across Solana's network, and its ability to handle high transaction volumes at low cost remains a differentiating factor. These structural strengths have helped prevent panic selling and support the view that recent weakness reflects market conditions and positioning rather than a breakdown in Solana's long-term prospects.

Despite the recent price drop, Solana's ecosystem shows resilience through high DEX volume, strong ETF inflows, and ongoing network upgrades. The $135 support level remains a key battleground between bulls and bears, with a successful defense potentially signaling a broader bullish rebound.