Solana (SOL) Price Falls Over 6% Amidst Fears of FTX Liquidation
The price of Solana (SOL) has experienced a significant drop of more than 6% in the past 24 hours. This decline has sparked concerns among investors that the bankrupt crypto exchange FTX may soon sell off its substantial holdings in SOL and other Solana-affiliated cryptocurrencies.
According to data from Solscan, FTX’s cold storage wallets hold a combined $1.5 billion in crypto assets on the Solana network. Of this amount, only $128 million is in Solana tokens, while the rest consists of various Solana-based altcoins, including Wrapped Bitcoin (WBTC), Maps token (MAPS), Serum (SRM), and other tokens playfully referred to as “Sam coins” in reference to former FTX CEO Sam Bankman-Fried.
The prospect of liquidators releasing $128 million worth of SOL and hundreds of millions worth of other SOL-affiliated tokens into the market has caused concern among some users. One user on X (formerly known as Twitter) wrote, “FTX about to dump $680 mil worth of SOL 👀,” while another stated, “SOL is going to dump hard after FTX sells its bag, going to reach $14 soon.”
Despite these worries, others have urged calm, pointing out that the bankruptcy plan includes restrictions on the sale of tokens. According to FTX’s bankruptcy filings, the proposed plan would allow the FTX estate to sell a maximum of $100 million worth of tokens per week, with the possibility of raising this limit to $200 million on an individual token basis. These measures have been put in place to minimize the impact of token sales on the market while ensuring creditor recovery.
It’s important to note that the proposed plan has not yet been approved by the courts, but discussions regarding the plan and other matters related to FTX token sales are scheduled to take place before the Delaware Bankruptcy Court on September 13.
In an April 12 hearing, FTX revealed that it had recovered approximately $7.3 billion in liquid assets, including $4.8 billion in assets as of November 2022. However, documents presented in the hearing indicated that FTX held a total of $4.3 billion in crypto assets available for stakeholder recovery at market prices as of April 12.
As of now, Solana is trading at $18.38, reflecting an almost 11% decrease over the past week.
Sources:
– Solana Price Index on CoinTelegraph
– Solscan
– FTX Bankruptcy Filings on CoinTelegraph
– Delaware Bankruptcy Court
– April 12 FTX Hearing on CoinTelegraph
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About the author - J-S Tremblay
I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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