Solana’s price may be threatened after FTX/Alameda redeemed 178,631 SOL tokens worth approximately $28 million, according to data from Solscan.
The funds, which are expected to flow through multiple wallets and potentially reach major crypto exchanges, could be headed for liquidation, raising concerns about the future of Solana’s price.
FTX/Alameda wallet redeems SOL amid regular transactions
A wallet linked to FTX and Alameda Research, identified as H4ygFZ, has moved 178,631 SOL tokens to 20 different addresses, as observed by on-chain data analyst EmberCN. This wallet has a history of performing similar transactions, transferring around 170,000 SOL tokens between the 12th and 15th of each month. The same wallet redeemed 177,693 SOL, valued at $23.75 million, on September 12th. The wallet still holds over 7.09 million SOL, worth more than a billion dollars, indicating potential future sales that could further impact the token’s price.
Impact of FTX and Alameda on Solana’s Price
FTX and Alameda had significant ties to Solana before both companies collapsed. Their extensive holdings of Solana tokens have been a critical factor in the asset’s price decline following the firms’ bankruptcies. Since the collapse, wallets associated with FTX and Alameda have gradually liquidated their SOL holdings. In late 2023, on-chain data provider Lookonchain highlighted a series of transactions involving FTX/Alameda wallets, which moved $127.5 million, including $41 million in Solana. FTX reportedly cashed out 1.5 million SOL in December, worth $90 million, through Coinbase. The exchange may continue to sell its Solana holdings through over-the-counter (OTC) transactions to prevent a steep decline in the token’s price.
Court approves FTX’s repayment plan to creditors
Recent Solana redemptions have coincided with a U.S. bankruptcy judge’s ruling, allowing FTX to proceed with its creditor repayment plan. The court approved using $16.5 billion in recovered assets to reimburse 98% of FTX’s customers.
Source: Coinbase via Tradingview
The plan targets creditors who held $50,000 or less balances when the exchange collapsed. Although the execution date remains unknown, creditors are expected to receive payments within 60 days of the formal announcement. This development could explain the timing of the latest SOL liquidations, which may be tied to FTX’s restructuring efforts.
Solana is trading at $154.25, nearing a resistance level of $161.52. If the redeemed tokens are liquidated, Solana’s price could drop to the $121.63 support level, causing further concern among investors.