Solana's Price Plummets: Can PumpFun's AMM Save SOL from $100?

Solana's price has been under significant bearish pressure, dropping below $160 for the first time since November 2024. This decline has sparked speculation about whether SOL could crash to $100, given the upcoming unlock of nearly $2 billion tokens from the FTX bankruptcy auction. As bearish sentiment grows, the crypto community is wondering if PumpFun's new Automated Market Maker (AMM) can prevent SOL's price from crashing to $100.

PumpFun, a platform that simplifies the creation of meme coins on Solana, is exploring the launch of its own AMM liquidity pools. This initiative aims to enable decentralized trading on the launchpad, reducing reliance on external decentralized exchanges (DEXs) like Raydium. A beta version of the AMM liquidity pool is already live on the PumpFun website, featuring a swap interface for trading SOL against meme coins.

By launching its own liquidity pool, PumpFun could make meme coin trading faster and potentially boost its revenues. This initiative could also attract more users to the launchpad, driving network usage and demand for Solana. If successful, this could help drive SOL's price upward.

However, the current market conditions suggest that SOL's price could face further challenges. The SOL price today sits at $159 after a 6% drop in 24 hours, bringing the monthly performance down by 35%. Analysts anticipate that Solana is structurally bearish after losing support at the $167-$169 zone. Despite the extended downtrend, buying support remains weak, which could lead to a drop between $112 and $126. If selling pressure does not recede, SOL could revisit the $100 psychological level.

The upcoming unlock of 11.2M SOL tokens next week and the Bybit hacker laundering stolen funds using Solana meme coins are contributing to the bearish Solana price prediction and the lack of new buying activity. However, if the firms that bought these tokens from the FTX bankruptcy auction decide to hold and not sell, it could spark a recovery.

The Solana liquidation map shows a large number of long liquidations below the current price. When long traders are liquidated, they are forced to sell to close their positions, exerting more downward pressure on the price.