Solana Token Unlock Fears
Is the market OVERreacting?
It’s been a crazy week, here’s a short recap to keep you in the loop.
HEADLINES
Solana Memecoin Ecosystem Rocked by Fraud and Insider Trading Allegations: The Solana memecoin market is in chaos as reports of fraud and insider trading surface, with projects like Jupiter (JUP) and Meteora implicated, contributing to a sharp decline in SOL’s price and ecosystem tokens.
Solana Price Plummets Over 10% Amid Token Unlock Fears: Solana (SOL) has dropped more than 10% in the past day, trading at around $167, down from its recent all-time high of $294 on January 19. The decline is attributed to anticipated token unlocks over the next three months, with over 15 million SOL (worth approximately $3 billion) set to enter circulation, potentially increasing selling pressure.
Bitcoin and Ethereum Pull Back as Market Sentiment Shifts: Bitcoin (BTC) and Ethereum (ETH) are trading within a weekly range but have seen minor pullbacks, with BTC slipping below $96,000 and ETH sliding under $2,600. The retreat follows a broader market slide, possibly influenced by macroeconomic factors like U.S. inflation data and holiday slowdowns.
Solana token unlocks refer to scheduled releases of previously locked SOL tokens into circulation. These events can impact SOL’s price by increasing supply and potential selling pressure.
Key Points:
Why It Happens: Tokens are locked at launch to prevent early dumps and align incentives. Unlocks follow a vesting schedule.
Who Gets Them: Early investors, team members, ecosystem funds, and staking rewards.
What’s Happening Now:
15M SOL (~$3B) will unlock between Feb-May 2025.
It’s a gradual release, not a single drop.
Market Impact:
More Supply: Can pressure prices if demand doesn’t keep up.
Selling Risk: Some holders may cash out after years of holding.
Sentiment Shift: Fear of unlocks can trigger preemptive selling.
Mitigating Factors:
Not all tokens are sold—some are staked or held.
Solana’s ecosystem growth could absorb the extra supply.
Previous unlocks caused dips but were followed by recoveries.
Memecoins
With fear hitting the timeline; starting a DCA into Solana here might be a decent play at 165; I am a pretty big fan of JUP as well so I’ll put mine into a JUP/SOL liquidity pool using Kamino.
To find Kamino, click HERE (Restricted in the US)
when the market rebounds you’ll want to have some positions!