In a surprising turn of events, Solana (SOL) has been experiencing a significant decline in trading volume, leaving many to wonder if the memecoin craze has finally reached its end.
Over the past four weeks, SOL has lost a staggering 38.35%, with no end in sight. At the time of writing, SOL is trading at $167.37, leaving investors questioning the future of this once-promising asset.
According to our analysis, the market could see even further price declines as sentiment continues to align with the bears.
Volume Drops: Memecoins to Blame? 🐶
Trading volume for SOL has taken a nosedive across both centralized and decentralized exchanges (DEXs), indicating a clear shift in market sentiment.
At the time of writing, SOL’s total transfer volume has plummeted from a peak of $2 billion in November to a mere $26 million. Such a sharp decline suggests reduced interaction with the ecosystem and a possible extraction of funds.
The recent LIBRA token, rumored to be linked to Argentine President Javier Milei, has reportedly triggered significant selling pressure on SOL. After its launch, LIBRA reached an all-time high of $4.563 before plummeting to $0.336, a staggering 96.63% drop.
Similar trends have been observed with major memecoin listings, such as TRUMP and MELANIA. When trading volume declines significantly, it often forces an asset’s price to drop sharply, as market participants sell to secure profits, break even, or cut their losses.
2 Factors Adding to the Bearish Pressure 📉
Solana’s social engagement is on track to reach its lowest point of the year, with a 69% decline in activity and interaction among online communities. This reduction in meme hype contributes to further price pressure.
The upcoming FTX SOL unlock, set to begin on the 1st of March, is expected to add to the price decline, with 11.2 million SOL entering market circulation. An increase in supply, when matched with low demand, often leads to further price drops.
With the unlock approaching, SOL could face additional losses unless sentiment shifts dramatically.
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2025-02-18 19:05