Solana (SOL) Price Corrects Amidst Market Consolidation
While the broader cryptocurrency market faces mild consolidation, Ethereum Layer-1 competitor Solana (SOL) has entered a strong price correction today. At press time, the Solana (SOL) price is down by 7% trading at $60.32 with a market cap of $25.5 billion.
Reasons Behind the Solana Price Drop
Solana has witnessed a massive price rally over the past month and so, becoming the sixth-largest cryptocurrency by market cap. The recent SOL price drop also coincides with a massive transfer taking place through an FTX cold wallet.
In a recent development reported by Lookonchain, an address closely associated with the FTX cold wallet, identified as 4Axqyo…HswTAh, unstaked a significant amount of 1.5 million SOL (equivalent to approximately $90 million) today at 7:55 UTC+8.
The entirety of this unstaked amount was subsequently transferred to the address 3vxheE5…5mgkom. According to Lookonchain, there is speculation that the receiving address, 3vxheE5…5mgkom, may be linked to Coinbase’s internal address.
As we know, crypto exchange FTX has been holding a massive amount of Solana before its bankruptcy filing last week. Now, the exchange has been liquidating its holdings in order to repay the creditors.
However, this hasn’t deterred Solana investors from embarking on a bullish price rally.
Solana Price Action and DeFi TVL
In the latest market update, SOL is currently quoted at $60.10, registering a 6.87% decline in the past 24 hours. Despite this minor setback, SOL has demonstrated resilience over the week, marking a 12.23% increase, and an impressive 46.84% surge over the last 30 days.
Recent market dynamics reveal an unsuccessful attempt by the SOL price to breach the $65.3 mark. Moreover, the asset has recently dipped below the critical support level of $62.5. Analysts suggest that a potential bullish scenario could materialize if the price successfully breaks above $63.4, paving the way for a retest of the $65.3 resistance level.
In the event of a bullish breakthrough, market observers anticipate a potential ascent towards the $79.1 level. Conversely, a dip below the $59 level could signal a downward trajectory, potentially testing the support level at $56.4. Investors and analysts are closely monitoring these key levels for potential market shifts.
Moreover, Solana, renowned for its exceptional throughput and scalability, is making waves in the decentralized finance (DeFi) realm. The recent surge in Total Value Locked (TVL) to an impressive $655 million showcases Solana’s growing influence and confidence within the DeFi sector.
This milestone not only reflects numerical success but also highlights Solana’s emergence as a formidable player in decentralized finance. While DefiLlama’s October statistics placed Solana’s TVL at around $326 million, a recent update reveals a remarkable doubling to over $655 million, marking the highest TVL in over a year and signaling robust and sustained growth.
Hot Take: Solana Faces Price Correction Amidst Positive DeFi Momentum
Solana’s recent price correction comes amidst overall market consolidation in cryptocurrencies. However, despite this temporary setback, Solana has shown resilience with significant gains over the past week and month. The recent drop in price coincides with a large transfer from an FTX cold wallet, possibly linked to Coinbase’s internal address. This could be a result of FTX liquidating its holdings to repay creditors. Despite these developments, Solana continues to attract investors and remains a strong competitor to Ethereum Layer-1. Additionally, Solana’s growth in Total Value Locked (TVL) within the DeFi sector highlights its influence and sustained growth in the decentralized finance space.
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