SOL Price Shoots 4.5% Despite Court’s Nod for FTX to Sell Solana Holdings
In a surprise move, the Solana (SOL) price has shot up by 4.62% and is currently trading at $18.90 levels with a market cap of $7.79 billion. This comes despite the US court giving a nod to FTX to liquidate their assets.
Recent filings indicate that the exchange is preparing to liquidate a total asset pool valued at $3.4 billion. The most substantial holdings in this portfolio are allocated to Solana (SOL), Bitcoin (BTC), and Ethereum (ETH). Furthermore, the mix of its digital currency holdings encompasses various assets, including, but not limited to, XRP, Wrapped Bitcoin (WBTC), and Aptos (APT).
Before its bankruptcy last November 2022, Solana (SOL) was a major reserve currency for the exchange. However, the exchange sold SOL in huge quantities in order to protect its native FTT token, but ultimately failed. Out of the total existing crypto holdings, FTX has $1.2 billion worth of Solana alone.
Why Solana Won’t Be Impacted by FTX’s Selling
Although FTX has received the court nod for selling its crypto holdings, it cannot sell all at once. FTX has appointed Mike Novogratz’s Galaxy Holdings for the liquidation process which will be gradual throughout the course of the next few years.
Popular crypto analyst Michael van de Poppe explains: To begin with, FTX has the capacity to sell assets worth up to $200 million per week to settle their liabilities effectively.
While this may introduce some additional selling pressure in the markets, it’s likely that this impact has already been factored into current prices.
The noteworthy observation here is that we might have expected a significant sell-off in Solana. However, anticipating this, Solana experienced substantial selling activity in the past week, potentially leading to a scenario resembling “sell the rumor, buy the news.”
Tron founder Justin Sun has asked the crypto community to unite and join forces in order to reduce the selling impact for FTX holdings.
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