- FTX estate-linked crypto wallet takes out 177,693 SOL from Solana PoS.
- This comes a day after Caroline Ellison’s trial hearing date is revealed.
- Technical analyst identifies SOL’s current sideways channel price range.
It appears that the fallen FTX exchange is getting ready to reimburse its clients. Nearly two years after its collapse in November 2022, a wallet associated with FTX and its sister company, Alameda Research, redeemed 177,693 SOL from Solana’s staking service.
FTX Setting the Scene for Client Repayment?
The major move has sent ripples through the crypto sphere, as the FTX estate has been notoriously known for its SOL sell-offs, mostly over the counter (OTC). While the 177,693 SOL remains on balance, it raises the question of whether these tokens will be dumped onto a centralized exchange in the coming days.
This move, worth nearly $24 million, coincides with the news that Caroline Ellison’s sentencing date is scheduled for September 24, 2024. Ahead of the trial hearing, the FTX defense might be readying the digital assets for a repayment plan, as no jail time for Alameda’s ex-CEO and Sam Bankman-Fried’s former lover is still on the cards.
Can Solana Withstand Looming Sell-Off?
As FTX’s legal case escalates, it bears to question the impact of the 177,693 SOL dump on the token’s market price. On Thursday, SOL picked up 2.3% gains to trade at $134.62, continuing to perform in a sideways trading channel. The price range between $120 to $190 is mulled as a sideways channel, with Solana’s price closing over the past seven days.
Crossing above the $190 resistance line on July 29, 2024, Solana couldn’t maintain the resistance level and even plunged below $120 briefly on August 5, 2024, a brutal day for the broader crypto markets. However, the $120 support levels proved genuine for SOL and have kept the “Ethereum Killer” in the sideways channel since.
Because of this, technical analysts such as CoinCodeCap Trading use the 200-day simple moving average (SMA) as a key indicator to determine Solana’s direction. The trader believes Solana’s 200 SMA, depicted by the purple line in the graphic, can breach the resistance level of $160. CoinCodeCap told his swing-trading followers to consider exiting the swing trade near $190, with a stop loss at $108.
On the Flipside
- Strong investor demand for Solana (SOL) reappeared in the derivatives market, which could minimize the chances of the FTX exchange’s impending sell-off having a major impact on the SOL price.
- To illustrate, SOL’s Open Interest-weighted funding rate flipped to positive on September 12, 2024, with a volume of $5.99 billion and a nearly 2% jump in unsettled leveraged plays.
- Aside from the recently unstaked $24 million, the address still has 7,057,463 SOL tokens staked, which amounts to a gigantic $950 million as of publication.
Why This Matters
Large token sell-offs tend to affect the market, while legal developments in the FTX bankruptcy case can pave the way for a smooth reimbursement plan for the devastated investors who lost money during FTX’s liquidity crunch in late 2022.
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