Solana (SOL) Sees Institutional and Retail Support Amid Downtrend

• Solana has been in a macro downtrend but is showing signs of institutional and retail investor confidence. Institutional inflows have remained strong, and retail holders are demonstrating patience by holding their positions despite being underwater.
• Institutional demand for Solana has remained resilient despite recent price weakness, with inflows totaling $92.9 million from the start of January through January 23.
• A notable increase in the 3-month to 6-month holding cohort indicates that retail and long-term investors are choosing to hold their positions, reflecting expectations of recovery and reduced selling pressure.

What Drives Institutional Confidence in Solana?

• Institutional confidence in Solana has surged, with nine spot Solana ETFs launched by late 2025, including the Bitwise Solana Staking ETF (BSOL) and the Fidelity Solana Fund (FSOL), attracting $1.08 billion in assets under management.
• The regulatory environment has also shifted in favor of Solana, with the SEC's expedited approval process and the Trump administration's pro-crypto stance accelerating ETF adoption.
• Innovations like STKESOL, a liquid staking token from Solana, allow users to stake SOL while maintaining liquidity, further supporting institutional adoption and DeFi growth.

How Do On-Chain and Economic Indicators Influence Solana's Price?

• Solana's price outlook is tied to network usage, performance, and supply dynamics, with key indicators such as network fees, active fee-paying addresses, supply inflation, and fee-burning trends playing a role in shaping price trends.
• The Chaikin Money Flow has recently moved into positive territory, indicating net inflows are returning to Solana and suggesting renewed demand and improved investor sentiment.
• Institutional inflows and retail holder behavior indicate improved stability, but risks remain below $121.56, and the death cross formation (50-day moving average below 200-day) signals prolonged bearish trends.