Large Solana (CRYPTO: SOL) holders sold out millions worth of the cryptocurrency Thursday ahead of the expected supply shock caused by the unstaking of SOL tokens.
What Happened: Four whales unstaked and dumped a total of $46.3 million worth of SOL, according to on-chain tracking platform Lookonchain. Typically, when whales sell, it can signal a potential shift in market sentiment from bullish to bearish.
The massive sell-off comes just ahead of the unlocking of $200 million worth of staked SOL on Friday, marking the largest single-day unstaking until 2028, according to on-chain analytics firm Arkham.
Why It Matters: Typically, token unlocks are interpreted as bearish on the belief that the price of the asset will dip as the market is flooded with extra supply. However, widely followed cryptocurrency trader MartyParty dismissed the amount as “insignificant.”
It’s worth pointing out that the unlock amounted to about 5% of SOL’s total trading volume of $4 billion in the last 24 hours.
Solana allows one to lock up their SOL holdings to help secure the network and earn rewards in the process. One can deactivate their stake and, after waiting for a cooldown period, withdraw their tokens with the rewards.
As of this writing, over $44 billion worth of SOL was staked to the network, according to Staking Rewards, with an annualized reward rate of over 8%.
Price Action: At the time of writing, SOL was exchanging hands at $114.81, down 4.33% in the last 24 hours, according to data from Benzinga Pro. Year-to-date, the cryptocurrency was down 39%.
Image via Shutterstock
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