- Wallets holding 100+ SOL dropped 2.24% in two weeks; $772M in stablecoins exited Solana in seven days.
- SOL/ETH pair declined 28% since February 3, with SOL briefly dipping below the 200-day SMA of $183.
- Negative funding rates signal oversold conditions, suggesting a potential short squeeze if short sellers exit positions abruptly.
The crypto market opened lower on Monday, with most digital assets recording losses. Solana, ranked sixth by market value, fell 6% in 24 hours to $184, underperforming the broader market’s 1.22% drop. Over the past week, Solana’s price has decreased nearly 10%, coinciding with a decline in activity across its network.
Data from crypto analyst Ali shows the number of wallets holding at least 100 SOL dropped 2.24% in two weeks, from 154,653 to 151,184. This reduction suggests decreased participation from mid-sized investors.
Meanwhile, LookOnChain reported $772 million in stablecoin outflows from Solana over seven days, primarily involving USDT and USDC. During the same period, Ethereum saw stablecoin inflows rise by $1.1 billion.
$SOL, $HBAR, and $ENA are currently among the most oversold assets based on funding rates! pic.twitter.com/GJUtKMaHf9
— Ali (@ali_charts) February 17, 2025
Solana’s price struggles extend to its performance against Ethereum. The SOL/ETH trading pair has fallen 28% since February 3, with a 5.2% drop in the last day. Despite briefly slipping below the 200-day simple moving average (SMA) of $183, Solana regained this level by press time.
ETHNews reveals conflicting signals. Solana’s open interest—a measure of active futures contracts—has increased, but funding rates remain negative. Negative funding rates indicate traders holding short positions are paying those with long positions, reflecting bearish sentiment.
ETHNews analysts note this scenario often precedes short squeezes, where rapid price rebounds force sellers to exit positions.
Crypto analyst Ali identified Solana as one of the most oversold assets based on funding rates. Oversold conditions suggest excessive short-term selling pressure, which could reverse if buyers reenter the market. While Solana’s 6% daily loss reflects current pessimism, the asset may stabilize if short sellers begin closing positions.
The recent decline highlights challenges for Solana’s network, including reduced investor activity and capital migration to competitors like Ethereum. However, technical indicators point to potential volatility ahead, with traders monitoring whether current levels attract new buying interest.
