Author: Mu Mu, Bai Hua Blockchain
Due to Solana's outstanding performance in this round of the bull market, many people believe that this round of the bull market is Solana's bull market. Looking back at Solana's development history over the past few years, whether it was catching the wind of Wall Street's entry into the DeFi Summer, or still grasping the "return of the king" of the Meme craze as a lifeline when FTX went bankrupt and fell into trouble, all of these make people feel that Solana's fortune is too good.
However, a giant like FTX can collapse overnight, and Meme also has its own tides of rise and fall. Recently, there are obvious signs of "recession" of Meme, coupled with the upcoming massive unlocking, which is a double whammy, and the pressure on Solana has doubled. Has its "good luck" really run out?
01. The Meme Tide Recedes
Recent on-chain data shows that Solana's on-chain trading volume has plummeted since February, and the number of Meme launches on related platforms has plummeted. The hot projects in the Solana ecosystem have all fallen sharply, and various FUD voices have started to appear on social media platforms.
The rise of Meme was originally driven by the call for "anti-VC", "no bagholding", and "fair launch", but after the Meme craze took off, various institutions quickly became the "big bosses" and quickly occupied the advantageous ecological positions. The crypto community soon found that without continuous capital inflows, the Meme that relied solely on fair launches was like a fleeting flower, so most people returned to the embrace of various institutions and became their bagholders.
Subsequently, the celebrity-backed presidential coin was born, with the Trump family Token first quickly draining the market's liquidity, and then the Millie Token landing another heavy blow. Afterwards, people gradually discovered that these celebrity projects all had an operation team behind them, and some were even interconnected. There was an invisible hand controlling every hot-chased project, and the crypto community suddenly felt that they had been repeatedly rubbed on the ground. Some KOLs directly stated that we in the crypto community just want to get out of the circle, not let the celebrities from outside come in and cash out...
Fundamentally, the rise and burst of the Meme bubble has ultimately exposed the "evil" of human nature. The greedy retail investors' excessive speculation has always been unable to escape the fate of being the "bagholder", which has dealt a huge blow to the Meme market, and for the Solana ecosystem, which has benefited from the Meme craze and has seen a rapid rise, it is like a heavy blow. The severity of the relationship is self-evident.
02. The Massive Unlocking That Comes at the Worst Time
While still immersed in the sadness of the Meme recession, another desperate news came: "12.2 million SOL will be unlocked on March 1st". At first, people mistakenly thought this was a planned small-scale unlocking as part of the token economic model, which usually has little impact on the market. But this massive unlocking is the second blow from the FTX bankruptcy, simply put, these 12.2 million SOL are part of the tokens sold by the liquidator in the FTX bankruptcy process. These tokens had a certain lock-up period (Vesting Schedule) set during the transaction, usually 1-3 years, and will enter the circulation market when the lock-up period expires in March 2025.
After the FTX bankruptcy in November 2022, the huge amount of SOL held by its affiliated company Alameda Research became part of the liquidation assets. It is estimated that FTX/Alameda initially held about 58 million SOL, accounting for 10%-15% of the total Solana supply at the time. The bankruptcy trustee (led by John J. Ray III) then sold these tokens to institutional investors at a discounted price. It is reported that the buyers of these tokens include institutions such as Pantera Capital, Galaxy Digital, and Figure Markets. According to information on X and on-chain data (such as Lookonchain's tracking), the market estimates that the selling price of these tokens was around $60-80 per token (30-40% of the current market price).
Since the 12.2 million SOL about to be unlocked were purchased by institutions at a discounted low cost, the market expects that if there is no one to quickly absorb them off-market, the unlocking may bring huge selling pressure to SOL, and the current pressure has already been transmitted to the current market price and the Solana ecosystem community.
03. Has Solana's Good Luck Run Out?
So has Solana's good luck really run out? It doesn't seem so. Whether it's the Solana spot ETF expected to be approved this year or Trump's series of crypto-friendly policies, they can be considered as the continuation of Solana's good luck.
The Solana spot ETF, which may be approved as early as June this year, is highly anticipated. Currently on a well-known prediction platform, the probability of Solana ETF being approved by 2025 is 84%, and the probability of being approved by June 30 is 38%. Looking at the previous performance of the Bitcoin and Ethereum spot ETFs, the Bitcoin spot ETF currently has a holding value of over $110 billion, while the Ethereum spot ETF has a holding value of over $10 billion. Given Solana's institutional support, it is likely to have at least tens of billions of dollars in inflows, which can easily offset the negative impact of the 12.2 million SOL unlocking. However, the problem is that the unlocking is imminent, while the ETF approval will take at least a few more months.
As for Trump's series of crypto-friendly policies, they are actually being gradually implemented, which is a friendly regulatory environment for the entire crypto industry. Benefiting from the accelerated catalysis of the Meme craze, the Solana ecosystem has also become remarkable. In early 2025, the trading volume of Solana's on-chain DEX even surpassed Ethereum, which can be considered as successfully passing the stress test. And both the number of users and activity have shown strong momentum.
In addition, the growth rate of Solana's developer community is also quite fast, and the planned iterative upgrades of Solana's roadmap will improve various shortcomings in the technical solutions, continuously attracting more and more attention to its ecosystem, with top institutions such as Paypal and Franklin Templeton also joining and adopting it.
04. Summary
Whether it's the cooling of the Meme craze or the massive unlocking, these are actually just short-term "birth pains" that are very common in the crypto field. They cannot be used to determine that Solana will collapse. Moreover, with its good ecosystem development momentum and the tailwind of friendly crypto regulation, as a top public chain established in the US, it is even more advantageous. As for the longer-term future, we can wait for more tests brought by time.
