- FTX estate sells $2.6 billion in Solana tokens.
- Figure Markets buys 800,000 SOL tokens for $80 million.
- Solana price falls 4% to $169 after sales.
FTX, once one of the largest crypto exchanges, has been undergoing liquidation, most notably of its vast reserves of Solana. The exchange was a major early backer of Solana, netting it billions of dollars worth of SOL.
Most recently, FTX sold the last of its SOL tokens at a steep discount, with firms such as Figure Markets and Pantera Capital purchasing large volumes of the token.
Discounted Sales of Solana Tokens by FTX Estate
The FTX estate recently completed the auction of a $2.6 billion cache of Solana (SOL) tokens, attracting notable buyers such as Figure Markets and Pantera Capital. The sales, which concluded on Friday, May 24, were part of FTX’s broader efforts to liquidate its assets following its high-profile bankruptcy.
Figure Markets secured a block of 800,000 SOL tokens for approximately $80 million, translating to about $102 per token. This price represents a significant discount, with Solana trading at $169 at the time. Pantera Capital also participated in the auction, although the exact details of their purchase remain undisclosed.
Just like with the previous SOL auctions, all tokens are subject to a four-year vesting period. This means that the tokens are locked and cannot be sold by buyers immediately. Instead, they will be gradually unlocked over the course of four years, starting with 20% in March 2025. The remaining tokens will be unlocked monthly until 2028.
Why Solana Tokens Sold at a High Discount
Because of the long vesting period, buyers are assuming the risk that the price of Solana might drop before they can fully access and possibly sell their tokens. To compensate for this risk, the tokens are sold at significant discounts. Earlier, some of these tokens were sold at $60 each, around 68% lower than the market price.
Vesting periods are necessary because they prevent a sudden influx of tokens into the market, with its significant downward pressure. By gradually unlocking tokens over time, the market can better absorb the increased supply.
What is more, the sale of these tokens enables the FTX estate to offload the risk of SOL volatility to third parties. This means that FTX creditors don’t have to worry about the price of SOL in the long run. Moreover, the discounted price of SOL is a good indication of what institutional investors think SOL’s price will be in the long term.
On the Flipside
- Despite the risk associated with FTX’s massive SOL holdings, Solana has performed remarkably well after its initial crash post-FTX collapse. Solana was up 756.94% from $20 this time last year.
- FTX originally held 41 million Solana tokens, valued at approximately $7.6 billion at the time of the sale. This accounts for more than 10% of Solana’s entire market cap.
Why This Matters
The participation of major firms like Figure Markets and Pantera Capital, even at a discounted price, indicates strong institutional interest and confidence in Solana’s long-term potential.
Read more about the FTX bankruptcy:
FTX Bankruptcy Estate Aims to Make Claimants Whole by 2024 End
Read more about Aptos challenging Solana:
Did Aptos Really Surpass Solana in Daily Transactions?
