Solana's Price Plummets 32% Amidst Network Activity Drop and FTX Unlock

Solana, a leading cryptocurrency, has faced challenges in recent weeks, with falling network activity and an upcoming major token unlock on the horizon. The altcoin's price has dropped significantly, falling from $256 to $173 in less than a month, a decline of 32%.

The upcoming token unlock, scheduled for March 1, involves the release of 11.2 million SOL, worth approximately $1.4 billion, from FTX's bankruptcy estate. This unlock, part of FTX's asset liquidation plan, could lead to increased volatility and a potential price drop for SOL.

The controversy surrounding the launch and subsequent rug pull of the LIBRA memecoin on the Solana chain has also contributed to the decline in network activity. The Argentine flagship index S&P Merval fell 5% following President Javier Milei's promotion of the memecoin on social media. The incident led to the resignation of Meteora's CEO, Ben Chow.

The number of active addresses on the Solana network has fallen significantly, reaching levels not seen since October 2021. While this level is still high compared to most of the previous year, the hype and trading activity in the ecosystem have noticeably decreased. Total transaction fees have also fallen to their late December lows, indicating lowered trading activity.

Despite these challenges, Solana remains a strong long-term performer. Its daily revenues are nearly tenfold that of Ethereum, although its total value locked (TVL) lags significantly behind. The price action, however, reveals a bearish structure. The $180-level has been ceded to the bears, and the price is currently under the $175 Fibonacci retracement level. A bounce towards $180-$190 is possible, but it is likely that the price will fall towards $157 and lower in the coming days, given its bearish momentum.