The cryptocurrency market is ending the month on a bearish note, with Bitcoin, ETH, SOL, and other leading cryptocurrencies currently in the red.
Solana’s SOL has wiped out 5% from its value in the last 24 hours, bringing its year-to-date gains to only 6%.
With the current market conditions, SOL could dip lower as sellers are currently in control.
Spot ETF debuts fail to boost price
The first spot-based Solana ETFs began trading in the United States earlier this week.
However, the launch didn’t spark a rally for SOL, as the cryptocurrency lost 5% of its value in the last 24 hours.
SOL briefly dropped below $180, bringing its year-to-date gains to just 6%.
The Bitwise Solana Staking ETF (BSOL), launched on Tuesday, recorded a $116 million net inflow across the first two sessions.
Meanwhile, the Grayscale Solana Trust (GSOL), which was converted from a closed-end fund into an ETF on Wednesday, attracted a meagre $1.4 million inflow.
However, the inflows weren’t enough to push SOL’s price higher, as it is currently 12% down from Monday’s high.
Despite that, experts remain optimistic about SOL’s performance in the medium to long term.
Bitwise CIO Matt Hougan revealed that he’s making two bets at once when investing in Solana.
He added that an investment in Solana is based on a dual bet that the stablecoin and tokenisation infrastructure market will grow, with Solana’s share of the market rising alongside. He added that,
“Over time, I suspect nearly all payments will be in stablecoins and nearly all assets will be tokenized. The blockchains that facilitate this growth will be extremely valuable. It’s easy to imagine this market growing by 10x or more. If I’m right, the combination of a growing market and a growing share of that market will be explosive for Solana. Just as with Bitcoin.”
In the short term, analysts are worried about the declining interest in Solana.
Blockchain data showed that Jump Crypto moved 1.1 million SOL (worth $205 million) to Galaxy Digital, receiving roughly 2,455 BTC ($265 million) around the same time.
The move could imply that Jump Crypto is rotating out of SOL to BTC, a worrying trend for Solana’s native coin.
Jump Crypto appears to be rotating a large amount of $SOL into $BTC!
In the past 15 minutes, Jump Crypto transferred the unstaked 1.1M $SOL($205M) to #GalaxyDigital and received 2,455 $BTC($265M) in return.
SOL could reclaim $200 if the market recovery continues
The SOL/USD 4-hour chart is bearish and inefficient thanks to the market’s sharp decline on Thursday.
The technical indicators have switched bearish, suggesting that sellers are currently in control.
The RSI has dropped to 43, below the neutral 50, indicating a bearish trend.
The MACD lines also crossed over into negative territory on Wednesday, flashing a sell signal for the pair.
If the bearish trend continues, SOL could drop below $170 for the first time since August 6th.
However, if the $173 support level holds in the near term, SOL could continue its recovery towards the TLQ and resistance level at $200.
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