Solana down 45% since Trump token launch as memecoins divert liquidity

6 months ago 40

The increasing appetite for memecoins whitethorn beryllium limiting Solana’s terms performance, manufacture insiders told Cointelegraph.

284 Total views

1 Total shares

Solana down 45% since Trump token motorboat arsenic memecoins divert liquidity

Solana’s terms continues to conflict nether unit from the increasing memecoin marketplace contempt showing resilience pursuing its largest-ever token unlock.

Solana (SOL) fell implicit 45% since the Official Trump (TRUMP) memecoin was launched, from implicit $261 connected Jan. 18 to $143 connected March 2, TradingView information shows.

The increasing capitalist appetite for memecoins whitethorn beryllium limiting Solana’s terms performance, according to Dan Hughes, laminitis of the decentralized concern level Radix.

Memecoins “don’t thin to gully successful overmuch outer superior flow; alternatively existing eco-system superior “round-robins” from 1 meme to the next,” Hughes told Cointelegraph, adding:

“Even successful the lawsuit of TRUMP, astir of the inbound liquidity was outflow from different crypto assets, radical selling their crypto portfolio to bargain TRUMP successful utmost FOMO [fear of missing out].”

“You tin spot the effect successful the market, wherever for a fewer days everything was reddish but TRUMP and Solana, and it was amusingly labeled the liquidity vampire,” helium added.

Memecoins whitethorn beryllium attracting a important stock of the recently entering liquidity from Solana. Circle minted implicit $8.75 cardinal worthy of USDC (USDC) since Jan. 1, according to Lookonchain, yet Solana’s terms fell implicit 24% contempt the caller liquidity.

Still, Solana’s terms managed to retrieve supra $140 contempt experiencing a $2-billion token unlock, which released implicit 11.2 cardinal SOL tokens into circulation connected March 1 arsenic the biggest token unlock for Solana.

Industry watchers were acrophobic astir a important downside determination for SOL since a ample magnitude of the unlocked tokens were purchased astatine $64 per SOL successful FTX’s auctions by firms specified arsenic Galaxy Digital, Pantera Capital and Figure.

Macro events, rug pulls are limiting organization crypto investment

External macroeconomic factors and caller information incidents besides proceed limiting the upside of the crypto market, said Hughes, adding:

“Events connected the satellite signifier are having a greater interaction than successful erstwhile cycles. A overmuch larger ratio of invested superior is institutional, who are overmuch much cautious, having to see a wider acceptable of markets, factors and variables erstwhile making decisions [...].”

“Couple that with the exhaustion of continued rug-pulls, hacks, losses, it volition instrumentality immoderate clip for the remaining particulate to settee and the mojo to travel back,” helium said.

Investor sentiment is inactive recovering from the $1.4 billion Bybit hack, which occurred connected Feb. 21, marking the largest hack successful crypto history.