In recent weeks, Solana (SOL), the sixth-largest cryptocurrency by market capitalization, has been experiencing a mighty surge. The token’s value rose by a staggering 170% over the course of a month.
However, Solana prices took a 5% hit earlier today after it was found that the now-defunct cryptocurrency exchange FTX had made arrangements to liquidate its SOL holdings. The move comes after the US bankruptcy court hearing the case gave the company the green light to sell its crypto holdings to repay creditors.
FTX’s Liquidation Spree Causes Dip In The Price of Solana
Crypto analytics firm Lookonchain found an on-chain activity that indicated the debtor group managing FTX’s bankruptcy had moved 250,000 SOL worth $13.6 million to the Kraken crypto exchange, along with $4 million in USDT stablecoin, which was transferred to Binance and Wintermute.
According to Lookonchain, the public address associated with FTX currently holds approximately 3,408 SOL, amounting to a total value of $185,000. Last week, the analytics firm reported that FTX had taken off $160 million worth of SOL from its staking wallets. The action had a temporary impact on the price of the token, causing it to drop to around $40 before rallying back again.
Prominent crypto analyst “Bluntz” noted a consistent selling pattern by FTX over the past two weeks. According to Bluntz, debtors of the crypto exchange have been liquidating between $250,000 and $700,000 in SOL on a daily basis. However, the intense selling pressure did not seem to drastically impact SOL’s price, which is an indication of strong adoption of the asset by the market and the potential for further price increases once the selling pressure eases.
Blockchain analytics firm PeckShield reported earlier today that an FTX-labeled wallet transferred $4.9 million worth of crypto on Ethereum and BNB Chain. The lot included 22,948 CAKE ($51,405), 37.7 million CHZ ($2.89 million), 1.57 million ENJ ($426,501), 4.45 million LRC ($997,000), 76.23 PAXG ($148,138), and 475,111 USDT.
In a separate transaction, an address linked to the bankrupt crypto exchange transferred 58.86 million TRX worth $6.1 million in current price to Binance and Kraken.
Meanwhile, a wallet linked to Alameda Research, the crypto hedge fund that was a sister firm of FTX’s, transferred 1.45 billion SPELL worth $758,000 to Coinbase Prime – the institutional crypto trading platform of Coinbase. In another transaction, the market maker firm that declared bankruptcy along with FTX moved 5.96 million USDT to Binance and 99.8 PAXG worth $194,694 to Wintermute.
Solana Continues to Stand Strong Despite Intense Selling Pressure Caused by FTX
Over the last 30 days, the price of Solana has surged by over 150%, thus pushing its market capitalization beyond the $20 billion mark. The rally is also in alignment with the bullish trend experienced by the broader crypto market that has seen Bitcoin (BTC) cross the $37,000 mark.
Despite experiencing a 6% dip in value, Solana is closing in on the $60 price point. Its 24-hour trading volume currently stands at $3.22 billion.
Crypto analysts view Solana’s dip as more of a healthy price correction. They speculate that a temporary drop on the chart might propel Solana to new-found heights. Amid the market turbulence, the cryptocurrency stands strong, reflecting its sustained market value and growth potential.
At the time of writing, SOL is trading at $59.57 – up 9.4% in the last 24 hours.