- Solana has seen a price drop of over 40% in the last 24 hours
- SOL is now trading at its lowest levels since March 2021
- The sell-off is fueled by serious troubles at FTX and Alameda Research, which are both major backers of Solana and its ecosystem
SOL price crashes amid uncertain FTX and Alameda Research situation
The Solana price has crashed by more than 40% in the last 24 hours amidst turmoil in the cryptocurrency markets. Of course, the most notable event in the crypto markets recently is the bank run on FTX, which was triggered by speculation that the exchange and its affiliated trading firm Alameda Research were insolvent. With FTX unable to access enough liquidity to cover all withdrawal requests, there are now plans for the exchange to be acquired by Binance, its biggest rival.
While the FTX / Alameda Research crisis has impacted the cryptocurrency market as a whole, some crypto assets have been impacted much harder than others. This of course includes FTX’s FTT token, but also coins such as Solana in which FTX and Alameda Research have significant investments.
Since both FTX and Alameda Research are both in dire need of liquidity, it’s reasonable to expect that they would be selling off their crypto holdings such as SOL. This undermined the market’s confidence in SOL, leading to a major sell-off.
Besides FTX and Alameda Research being forced to sell SOL, the situation has also created concerns about how FTX being potentially acquired by Binance would affect the Solana ecosystem on a fundamental level—this has also negatively impacted the price of SOL. While Solana’s future could still be bright, the apparent downfall of FTX could provide a setback for its ecosystem.
FTX is one of the biggest supporters of Solana itself as well as various projects building on the platform. Binance, on the other hand, is of course expected to prioritize the BNB Chain ecosystem.
Today, the SOL price hit a local bottom of $15.9, which is the lowest price since March 2021. SOL/USD is down a massive 47% in the last 30 days. In comparison, Bitcoin has lost 8.3% against the dollar in the same time period, while Ethereum is down 8.1%.
It’s not all doom and gloom for Solana
If we focus on some positive Solana news, the project has recently announced a partnership with hardware wallet manufacturer Ledger, which will entail a suite of integrations between the Solana Mobile platform and Ledger’s Ledger Live and Ledger Connect products.
In addition, Google’s cloud computing arm Google Cloud has recently revealed that they are running a validator for the Solana blockchain. Google Cloud also says that it will allow customers to launch dedicated Solana nodes through its Blockchain Node Engine product. The feature is expected to launch next year.