On February 24, Binance facilitated a sale of Solana ($SOL) tokens through its market maker, Wintermute. Data from on-chain sources and social media indicate that Wintermute offloaded 5,000,000 SOL tokens at an average price of $120 each, which market watchers predict could add to the coin’s price struggles.
The sell-off began at approximately 6:00 AM UTC and continued for four hours. By the end of the trading session, Binance had executed sales totaling $600 million in SOL.
The impact on the crypto’s price action was felt almost immediately, and SOL dropped by 6.17% in the day, now trading below the $169 mark.
On-chain data showed that more than $1.5 billion had left Solana’s ecosystem in the last 24 hours. This was more than the $1.43 billion that came in during that time.
Wintermute and SOL traders’ withdrawals cause price drops
One crypto analyst on X, going by the pseudonym Defi_FinChain, explained that multiple factors might have driven Binance and investors to succumb to selling pressures. They believe the market is in a state of profit-taking, following Solana’s peak at $295 in January, that now seems “unreachable.”
Data from Into the Block today showed a 10% drop in daily active addresses on Solana, and a monthly drop of about 45%, compared to January’s 105.4 million.
A well-known crypto enthusiast on X, Multiworm Zero, commented that Solana’s price struggles to go above $250 will encourage investors to continue taking exit positions.
“The beatings will continue until SOL price improves,” he wrote, adding that $150 could be a critical level to watch, as it represents a 50% decline from the all-time high value of $294.33, reached on January 19. If the crypto falls below the immediate support level, he predicted that a drop to $120 will likely happen.
The #SOLANA chart is holding below the trend line (the one I've drawn) in a pretty convincing manner.
— Multiworm Zero (@MultiwormZ) February 24, 2025
The beatings will continue until $SOL price improves.
About $150 is 50% from the recent top. Maybe it can find some support there. If not, $120 could be in the cards in the… pic.twitter.com/XPyidq6S1S
According to Coinglass data, since February 15, Solana’s spot exchange inflow-to-outflow ratio has been in the negative range, recording -$69.82 million over the weekend. It could mean investors are withdrawing their holdings from exchanges, hoping to alleviate the selling pressures. The token’s price downtick could influence them to sell their positions to avoid losing much of January’s profits.
Short-term price action spells woe, long-term outlook seems bullish
The technical indicators on TradingView show that Solana is in a phase of consolidation. It is a long way from its highs in January. At 21.91, the Relative Strength Index (RSI) has hit oversold levels, which suggests that prices might go up again.
The Moving Average Convergence Divergence (MACD) indicator is also getting close to a crossover, which will make its range smaller from -12.81 to -10.58.
Traders are keeping a close eye on levels of support and resistance to find good opening points. The main support area at $156 lines up with the area of resistance that turned into support, which means it could be a place for a bounce.
If there is more buying pressure, short-term goals include $168 and $177, which would give the bulls upward steam.
Solana is set to unlock 11.2 million SOL tokens on March 1. These tokens are worth about $1.78 billion. The release, which is related to the bankruptcy procedures from the fall of the major exchange FTX in 2022, could cause prices to drop as more people sell.
On-chain data from Santiment shows the funding rate for Solana has turned negative. Short sellers are currently dominating the derivatives market, giving bears an upper hand in driving SOL down.
A negative funding rate means that short positions are paying a fee to long positions, and that could mean investors are not confident Solana’s price will go up in the coming weeks. If the selling momentum continues, SOL could accelerate downwards and go below $100.
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