Written by: Bitui Asher Zhang, Bitui
We wrote an article in September this year, "Why did Visa choose the "reborn" Solana? ”, which talked about why Solana can always hold up in the bull-bear rotation. With the recent increase in the price of SOL, it has further attracted a lot of attention from the market. With the FTX incident coming to an end, Solana seems to be back in the spotlight again. So, why did the FTX incident have such a direct impact on Solana? What are the underlying reasons behind Solana’s strength? What projects in the Solana ecosystem are worth paying attention to?
FTX may be opened again, and Sol will take advantage of the trend
With the FTX case temporarily coming to an end, on Thursday, November 9, local time in the United States, the token FTT of the Thunder Exchange FTX suddenly increased by about 90%, rising from a low of about $1.8 to a high of more than $3. . At the same time, SOL also soared from around $40, reaching a maximum of $63.95, an increase of about 60%. Why did FTT suddenly surge? What does the surge in FTT have to do with SOL?
The surge in FTT is mainly related to the words of US SEC Chairman Gary Gensler. At the Washington, DC Fintech Week, Gary Gensler said: "If Tom (former president of NYSE, now in charge of a major bidding company trying to restart FTX) or others want to To enter this field, I would say, just do it within the legal framework."
So, what is the background of the players behind the scenes who want to take over FTX? Last month, a banker who advised FTX on the auction process told a hearing that the company received interest from more than 70 parties, but it was ultimately whittled down to three: Gary Gensler was referring to a group led by former New York Stock Exchange president Tom · Bullish, a cryptocurrency exchange run by Tom Farley, along with Figure Technologies, a financial technology startup, and Proof Group, a crypto venture capital firm. Bullish is a subsidiary exchange of Block, registered in Gibraltar. It mainly targets institutional customers and currently does not provide services to US users. Figure Technologies uses blockchain technology to provide financial services, while Proof Group is a Silicon Valley investment group that won the acquisition of bankrupt Celsius and is also an investor in Aptos and Sui.
Next, let's take a look at the relationship between FTX and SOL. FTX's largest holding is Solana (SOL), which holds approximately 55.8 million SOL, worth $1.162 billion, and holds more than 10% of the total supply of SOL. It is worth noting that most of FTX’s SOL holdings are subject to a structured unlocking plan. According to the unlocking plan, 6.184 million SOL will be unlocked every month. It is worth noting that 7.5 million SOL is expected to be unlocked on March 1, 2025, accounting for 13.5% of FTX’s total SOL holdings. FTX’s SOL unlocking plan is as follows:
From the perspective of position structure, once FTX goes bankrupt and reorganizes, besides FTT, SOL will undoubtedly be the biggest beneficiary. If FTX is simply liquidated, it will be like MT.GOX. Its holdings of SOL will create huge selling pressure and inhibit the rise in SOL prices; but if FTX restarts, SOL will become FTX's most important crypto asset and resource. FTX's The takeover will undoubtedly continue to cooperate in depth with SOL to promote the development of SOL. As the value of SOL grows, it will ultimately help FTX get out of financial difficulties.
Bull and bear reincarnation, countless dead, why is Sol strong?
In every round of bull-bear transition, a large number of projects will fall. On October 24, according to Bitui, Parity Technologies, the Polkadot ecological development organization, plans to lay off 30% of its employees, about 100 employees. Even Polkadot, the cross-chain king who once had many auras, is essentially tightening its belt. However, Solana has essentially been growing and achieving a lot, which is the deeper reason for its strong price performance.
In April this year, Solana launched a new feature "state compression" for NFT storage, which can reduce the cost of minting NFTs on Solana by 2,400-24,000 times. The cost of minting 1 million NFTs will be reduced from US$250,000 to US$110. In July, Solana released the GameShift API, which aims to better empower developers to develop Web3 games in Solana and simplify its development difficulty. In the same month, Neon, an EVM compatible solution based on Solana, was officially launched on the mainnet. Then Solana launched a smart contract compiler that supports Solidity, aiming to further open up the connection with the EVM ecosystem.
From the end of August to the beginning of September, Shopify and Visa announced their integration with Solana, expanding Solana's payment service territory in the Web2 world. In September, Rune Christensen, the founder of the Ethereum OG project Maker, publicly praised Solana. Some of the reasons he mentioned may also be the root cause of the sharp increase in the price of SOL.
Why does MakerDao think Solana is the most suitable public chain? On September 1st, MakerDao founder Rune posted on the forum: Cosmos is not built with efficiency as the core as Solana, which means that the cost of maintaining and maintaining performance will be higher; as for public chains such as Aptos and Sui, it is not at all Suitable. Rune mainly gave three reasons for choosing Solana: First, the technical quality of Solana's code base is very good, which is very consistent with NewChain's own goal of solving Maker's technical debt; second, Solana already has two clients, which It is crucial for flexibility. In addition, the Solana ecosystem has survived the FTX thunderstorm, which proves the resilience of the public chain. Thirdly, there are already examples of the Solana code base being forked and adjusted into an application chain, which will help MakerDao build itself in the future. application chain.
What are the opportunities for the Solana ecosystem?
Recently, although Solana's token has increased 4 times, its TVL has only doubled. This is mainly related to the fact that many projects in its ecosystem have not issued tokens, many of which deserve attention. Seven of the top ten TVL growers in the past month were launched within the past year.
From the above classification, it is clear that these projects help create a diverse ecosystem on Solana. According to TVL, the most successful project is Jito, a liquidity staking provider that offers liquidity staking and MEV rewards. Marginfi offers another liquid pledged token (LST) based on jitoSOL (Jito’s LST), as well as a lending service focused on risk management. Among the projects that are not in the top ten, there are also many outstanding performances. Phoenix (a project from Ellipsis Labs) is a completely on-chain limit order book that seems to want to fill the void left by Serum. Jupiter is an exchange and cross-chain bridge aggregator that has just launched a perpetual protocol on top of it. There are many other types of projects. Tensor is Solana's answer to Blur, and Squads is a multi-signature protocol used by most Solana projects, protecting over $500 million in funds.
In addition, Solana is also vigorously supporting ecological projects. In the past third quarter, Solana has co-organized and sponsored many hackathon events such as OPOS, Hyperdrive, Hacker Houses, PlayGG, etc. with other ecological partners, and provided millions of dollars in early funding to many outstanding teams. .
Summarize
The recent conclusion of the FTX case has directly stimulated the rise of Solana, but the more essential reason lies in Solana's underlying technology. Solana's core team has a background in high-tech companies such as Qualcomm and Google. Its history has proven that the (PoH) algorithm has great advantages in scalability, speed, security, efficiency, etc., which has also become the choice of many people as the underlying facility. s reason. From the perspective of future development space, due to the deep binding of SOL and FTX, if FTX restarts, SOL and FTX may start a "honeymoon" again, and the two may promote each other. From an ecological perspective, the overall TVL of new projects on Solana is still relatively low, and the future development space is worth looking forward to.
