Solana Soars to $293 – What’s Behind the Surge?
Solana (SOL) hit an all time high of $293. 42% since the beginning of January. As of 12:30pm ET SOL is at $266.90.
The surge is partly due to the launch of Donald Trump’s official meme coin TRUMP. According to Solanafloor, on-chain data shows the TRUMP team wallet (which provides liquidity to Meteora’s pools) has been buying millions of dollars of SOL with fees from these pools. Result? $31.6 billion in 24 hour global volume for SOL. The token is getting more popular and more liquid.
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A Year of Stellar Performance for Solana
Beyond the meme coin hype, Solana’s growth is part of a broader recovery. Over the past 12 months SOL has gone up 187% after dropping 75% from the FTX collapse in 2022. FTX had a large amount of SOL and during the liquidation process the market sentiment was greatly impacted.
During FTX’s bankruptcy the estate liquidated 25-30 million locked SOL tokens, selling them for $64 each on average and raising around $1.9 billion. The last batch was sold for $102 each, much lower than today’s price of $266.90. Solana is proving to be resilient and can recover after big setbacks.
Challenges Ahead: Token Unlock Looms
Solana’s momentum is tested on March 1, 2025 when 112 million SOL will be unlocked. This will release around 23% of the total supply into the market and could impact liquidity and price.
Key considerations for investors include:
Liquidity pressures: A significant increase in circulating supply could lead to short-term price volatility.
Investor sentiment: The token unlock may influence market psychology, with traders watching closely for selling pressures.
Market resilience: Solana’s ability to absorb the new supply and maintain its upward trajectory will signal its maturity in the cryptocurrency ecosystem.
As Solana navigates this pivotal period, its trajectory will depend on the interplay of market forces, technological developments, and investor confidence. The coming months will reveal whether SOL can sustain its impressive growth or face new challenges in the rapidly evolving crypto landscape.
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