Why is Solana (SOL) price down today?

Solana (SOL) is on the verge of wiping out your entire positive aspects it post-Donald Trump’s reelection in November.

On Feb. 24, the SOL/USD buying and selling pair dropped 7.35% to succeed in $157.25, its lowest level since Nov. 6.

These losses are a part of a broader correction that started on Jan. 19, when SOL reached its all-time excessive of $295.31. Since then, the worth has tumbled 47%.

Key catalysts driving the SOL costs decrease embody:

• Solana’s alleged hyperlinks with North Korea’s Lazarus Group.

• An upcoming SOL token unlocking occasion.

• Detrimental SOL funding charges.

Solana’s alleged ties with Bybit hackers

Solana’s worth is down at present amid rising issues over its affiliation with high-profile hacks and memecoin scams.

Issues to know:

• The $1.4 billion Bybit hack on Feb. 21 has been linked to North Korea’s Lazarus Group, a infamous hacking group.

• Onchain investigator ZachXBT found that wallets tied to the Bybit hack have been additionally concerned in Solana-based memecoin scams, notably “rug pulls” on Pump.enjoyable.

• The identical wallets have been linked to the $29 million Phemex hack in January, indicating a sample of fraudulent exercise exploiting Solana’s ecosystem.

• Solana has been stricken by memecoin scams, together with the $107 million rug pull of the Libra token, resulting in a decline in person belief and capital inflows.

• The mix of hacks, scams, and adverse sentiment is lowering buying and selling exercise and weakening demand for SOL, contributing to at present’s worth decline.

Associated: ETF approval will help Solana break the ‘memechain’ narrative

Prime Solana memecoins, comparable to Official Trump (TRUMP), Bonk (BONK), and Dogwifhat (WIF), have suffered large losses on 24-hour and 7-day adjusted timeframes, as proven beneath.

Key factors:

• Memecoins drive a big portion of Solana’s transaction quantity.

• Fewer transactions imply much less demand for SOL to pay community charges.

• Merchants beforehand purchased SOL to commerce memecoins, stake, or present liquidity.

• A memecoin slowdown reduces SOL purchases, lowering shopping for stress.

Solana faces “peak FUD” from token unlock

SOL’s worth declines seem forward of its upcoming token unlocking occasion.

What to know:

• Market uncertainty about how a lot of the unlocked SOL can be bought is resulting in cautious buying and selling and danger aversion.

• Traders preemptively pricing within the unlock influence is inflicting SOL to underperform forward of the occasion.

Solana’s funding charges go adverse

Solana’s open interest (OI) is decreasing, and its funding charges are adverse, which gives essential perception into why SOL’s worth is falling.

Key factors:

• Solana’s OI within the futures market has dripped from its native peak of $8.57 billion on Jan. 17 to $5.11 billion as of Feb. 24.

• OI measures the full variety of excellent futures contracts, and a lower suggests extra merchants are exiting positions.

• A declining OI sometimes means lowered speculative demand, slowing upward worth momentum.

• In the meantime, SOL’s weekly funding charges dropped to -0.48% on Feb. 24 in comparison with 0.354% two days in the past.

• Detrimental funding means shorts are paying longs to maintain their positions open.

• OI decline mixed with adverse funding charges exhibits a insecurity in SOL’s short-term worth motion, rising the chance of additional draw back.

Solana eyes one other 30% drop

Solana’s worth drop seems to be a part of its prevailing head-and-shoulders (H&S) sample.

Word that:

• A decisive breakdown beneath $$177 will increase the dangers of Solana worth dropping towards the H&S goal of round $110, down by over 30% from present costs.

• Nonetheless, if SOL reclaims the neckline as assist, a possible restoration towards the native excessive of $215 may comply with, invalidating the H&S outlook.

This text doesn’t include funding recommendation or suggestions. Each funding and buying and selling transfer includes danger, and readers ought to conduct their very own analysis when making a call.