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Analysis

Solana Continues to Rally Despite FTX Massive Low Price Sale

Solana (SOL) continues to rise despite FTX's massive sale. Bloomberg reported on June 6 that the FTX Bankruptcy Foundation sold about 30 million FTX-owned SOLs at a low price of $64 per unit as part of the bankruptcy proceedings. The amount sold by the FTX Bankruptcy Foundation represents about...

Solana Continues to Rally Despite FTX Massive Low Price Sale

Solana (SOL) continues to rise despite FTX's massive sale. Bloomberg reported on June 6 that the FTX Bankruptcy Foundation sold about 30 million FTX-owned SOLs at a low price of $64 per unit as part of the bankruptcy proceedings. The amount sold by the FTX Bankruptcy Foundation represents about two-thirds of the FTX Bankruptcy Foundation's Solana holdings, and the sale price is about 62% below the market price.

The large-scale sale of Solana by the FTX Bankruptcy Foundation is part of the FTX debt repayment process announced by the FTX Bankruptcy Foundation on March 1. The FTX Bankruptcy Foundation said it will begin repaying its debts in earnest later this year under Chapter 11 of the U.S. Bankruptcy Code. In order to repay its debts, FTX has begun selling off its Solana inventory. The proceeds from the sale of Solana to the FTX Bankruptcy Foundation are estimated to be approximately $2 billion. Despite FTX's massive sale, the price of Solana hasn't dropped significantly. After hovering around $190 per unit for five days, the price of Solana is currently around $179 per unit on CoinMarketCap at 10am on August 8th.

One of the reasons why Solana's price has remained relatively defensible in the face of FTX's massive sale is that Solana's momentum has been steady since last year, despite numerous crises. Since last year, Solana has rallied to become the fifth-largest cryptocurrency by market capitalization, despite FTX's bankruptcy, the potential for a massive selloff, and intermittent mainnet outages, thanks to the popularity of Solana-based non-fungible tokens (NFTs).

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