Solana (SOL) Price: Experiences 50% Correction from 2024 High as March Token Unlock Approaches

TLDR

• Solana (SOL) has crashed nearly 50% from its 2024 high of $264
• Investor sentiment has turned fearful after months of optimism
• Key support level at $120-$140 will determine future price direction
• March 1st token unlock of 11.2M SOL creating additional selling pressure
• Market analysts divided between further decline to $70-$100 or potential recovery to $170

Solana (SOL) has seen a steep decline in recent weeks, dropping almost 50% from its 2024 high of $264. The cryptocurrency is currently trading at around $142, after experiencing a 40% monthly decrease that has shaken investor confidence and sparked debates about its near-term future.

The dramatic price correction has pushed SOL to a five-month low, with the token hitting $131 on Tuesday morning – its lowest value since September. This sharp decline marks a turning point for one of 2023’s top-performing cryptocurrencies, which had previously maintained strong momentum despite various market challenges.

Analyst Miles Deutscher pointed out that Solana’s sentiment has reached its lowest point in over a year. According to his analysis, investor mood hasn’t been this negative since SOL first reclaimed the $100 mark at the beginning of 2024, highlighting the severity of the current market downturn.

$SOL sentiment is the worst that it has been in over a year since first reclaiming the $100 level.

After being a top performer for so long, it's finally having its capitulation moment. I think we're getting close now… pic.twitter.com/spVr97J8Za

— Miles Deutscher (@milesdeutscher) February 25, 2025

The broader cryptocurrency market has also experienced a notable correction, with Bitcoin dropping from $96,000 to below $90,000 for the first time since November. This market-wide downturn has amplified pressure on alternative cryptocurrencies like Solana, which often follow Bitcoin’s price movements with higher volatility.

Trading Analysis

Trading volumes for SOL have dropped by 18% to $13 billion, further indicating waning interest from traders during this correction phase. This decrease in trading activity suggests that many investors are staying on the sidelines while awaiting clearer market direction.

The bearish shift in Solana’s market comes after Glassnode’s Net Unrealized Profit/Loss metric revealed that SOL investors have entered a fearful phase. This represents a major change from previous months when market sentiment toward Solana was characterized by greed and optimism.

Several factors have contributed to SOL’s price decline beyond the general market downturn. The proliferation of Solana-based meme coin scams, particularly after the introduction of the Pump.Fun platform, has damaged confidence in the ecosystem. The LIBRA token scam stands out as a particularly harmful example that resulted in losses exceeding $100 million for investors.

Solana Price on CoinGecko

The overall market capitalization of Solana-themed meme coins has plummeted from $25 billion in January to $8.6 billion currently. This collapse has triggered what some analysts describe as a capital rotation from Solana to Ethereum, as investors seek safer alternatives within the cryptocurrency space.

Network activity on Solana has also shown concerning trends, with metrics like gas fees, decentralized exchange (DEX) volume, and active address counts all declining. These indicators suggest reduced usage of the Solana blockchain and diminishing confidence in its ecosystem.

Adding to Solana’s challenges is the upcoming token unlock scheduled for March 1, which will release 11.2 million SOL tokens into circulation as part of the FTX distribution plan. This event is creating additional selling pressure as investors brace for increased supply that could potentially push prices lower in the short term.

Market watchers are closely monitoring the critical support zone between $120 and $140, which many analysts consider a “must-hold” area for SOL. Crypto analyst Ansem noted, “The $120-$140 range is a must-hold area. Shorting after a 50% drop in a month is not a good trade, but overall, I remain bearish on most crypto assets in the high timeframe.”

If Solana manages to maintain this support level, analysts suggest it could rebound toward the $170 resistance area. However, a breakdown below $120 might lead to a test of the psychological $100 support level, with some bearish predictions pointing to a potential drop to $80 or even $70.

Analyst Ali Martinez has drawn parallels between the SOL/BTC trading pair and ETH/BTC’s past price action. According to Martinez, if this pattern continues, SOL/BTC could be headed for a 50% drop to 0.0008, which would push Solana’s price to around $70.

#Solana against #Bitcoin is starting to resemble #Ethereum past price action against $BTC. If this pattern holds, $SOL could drop to 0.0008 satoshis! pic.twitter.com/2bD7UuQRWQ

— Ali (@ali_charts) February 25, 2025

Despite these negative projections, other analysts maintain a more balanced view. Altcoin Sherpa considers the $90-$125 region a “good area overall” for purchasing SOL, stating that he doesn’t believe Solana is “dead.” While he expects volatility to continue, he anticipates an eventual recovery from current lows.

The technical picture shows that the $130-$140 zone has historically served as a key support level during both the 2021 all-time high breakout and the 2024 rally. Holding this area will be crucial for Solana’s performance in the coming weeks, especially with the token unlock event on the horizon.

Some traders have adopted a cautious approach, with one noting, “You can dip in briefly and come out with a tasty 1-2% profit at this Solana price. If that line breaks, it’s heading to $80.” This reflects the short-term trading mentality that has emerged amid the current uncertainty.

For investors considering their next moves, analysts recommend carefully monitoring SOL’s price action around the current support levels before making decisions. The token’s behavior in response to the March 1 unlock event will also provide important clues about its medium-term direction.

After experiencing minimal recovery of 1.5% in the last 24 hours, SOL currently trades at $142.39. While this represents a slight bounce from recent lows, it hasn’t been enough to change the prevailing bearish sentiment that has gripped the market.

The coming weeks will be critical for Solana as it navigates this challenging period of market correction, negative sentiment, and upcoming supply increases. Whether SOL can hold its key support and regain upward momentum remains to be seen, but many investors are watching closely for signs of a potential recovery.

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