{"id":18035,"date":"2025-03-19T10:48:03","date_gmt":"2025-03-19T10:48:03","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=18035"},"modified":"2025-03-19T10:48:03","modified_gmt":"2025-03-19T10:48:03","slug":"solana-stablecoin-positioning-threatens-extreme-sol-volatility","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=18035","title":{"rendered":"Solana stablecoin positioning threatens \u2018extreme\u2019 SOL volatility"},"content":{"rendered":"
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\"Solana<\/p>\n

Investors\u2019 stablecoin positioning on the Solana network and a key technical chart pattern threaten more volatility for the Solana token, which may see a decisive moment for its price action.<\/p>\n

Solana\u2019s transport layer saw \u201cextreme\u201d volatility in trading the Tether\u2019s USDt (USDT<\/a>) stablecoin, which may indicate that traders are repositioning in search of new investment opportunities.<\/p>\n

USDT trading on Solana\u2019s transport layer saw an over 137% surge during the last week of February, after seeing a 61% plunge during the previous week, according to a report by global payments infrastructure platform Mercuryo, shared with Cointelegraph.<\/p>\n

The stablecoin trading spikes show an unparalleled level of trading activity that may signal more volatility for the Solana (SOL<\/a>) token, according to Petr Kozyakov, co-founder and CEO of Mercuryo.<\/p>\n

The \u201cfrenetic activity\u201d may \u201cindicate that the chain is prone to be more volatile,\u201d the CEO told Cointelegraph, adding:<\/p>\n

\u201cHowever, Solana\u2019s inherent strengths \u2013 fast transaction processing, high scalability, and an active trading ecosystem \u2013 may also be factors. This is against a backdrop of an ecosystem attracting at times high trading volumes.\u201d<\/p><\/blockquote>\n

\u201cNotably, DEX\u2019s on Solana, such as Jupiter and Raydium, have ignited significant interest,\u201d he added.<\/p>\n

Related: <\/strong><\/em>Crypto market\u2019s biggest risks in 2025: US recession, circular crypto economy<\/strong><\/em><\/a><\/p>\n

Meanwhile, a key emerging technical chart pattern may be decisive for Solana\u2019s price action in the near term.<\/p>\n

\"Solana
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Source: <\/em>Trader Tardigrade<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n

\u201cSolana Heikin Ashi hourly chart shows a Converging Triangle. Both bullish or bearish moves are possible,\u201d wrote pseudonymous crypto analyst Trader Tardigrade in a March 19 X post<\/a>.<\/p>\n

Related: <\/strong><\/em>Bitcoin beats global assets post-Trump election, despite BTC correction<\/strong><\/em><\/a><\/p>\n

Memecoins, FTX repayments may be limiting SOL price<\/h2>\n

While some analysts suggest that the current memecoin frenzy has been siphoning liquidity from the Solana token, multiple other factors are influencing SOL\u2019s price action.<\/p>\n

Notably, the incoming repayments from bankrupt FTX exchange may limit Solana\u2019s price action, explained Kozyakov, adding:<\/p>\n

\u201cThe defunct FTX exchange has set up a repayment plan that involves distributing a large amount of SOL tokens to creditors, which can potentially result in selling pressure.\u201d<\/p><\/blockquote>\n

FTX and Alameda Research-linked wallets unstaked $431 million<\/a> of SOL tokens on March 4, marking the biggest SOL token unlock since November 2023, Cointelegraph reported.<\/p>\n

Although FTX and Alameda unlocked more than $400 million in SOL, the firms may not be able to sell all the tokens in a single transaction. In September 2023, the Delaware Bankruptcy Court approved FTX\u2019s plan to sell digital assets<\/a>, imposing strict limits on liquidation amounts.<\/p>\n

Under the court ruling, the bankrupt exchange can sell digital assets weekly through an investment adviser, with an initial limit of $50 million in the first week and $100 million in subsequent weeks. If FTX seeks to sell more, it must request court approval to raise the limit to $200 million per week.<\/p>\n

FTX\u2019s next round<\/a> of repayments will take place on May 30. Under FTX\u2019s recovery plan, 98% of creditors are expected to receive<\/a> at least 118% of their claim value in cash. In May 2024, the exchange estimated the distribution\u2019s total value to range between $14.5 billion and $16.3 billion.<\/p>\n