Menu

Categories:

Hot right now:

Follow on:

Coinsurges provides coverage of fintech, blockchain, and Bitcoin, delivering the most recent news and analyses on the future of money. Stay up-to-date with live prices, charts, and trading options for the top exchanges. Keep track of the day's top cryptocurrency gainers and losers, as well as which coins have experienced gains and losses in the past 24 hours.
Trust Coinsurges as your go-to source for all news and updates in the industry.

Menu

Categories:

Hot right now:

Follow on:

Coinsurges provides coverage of fintech, blockchain, and Bitcoin, delivering the most recent news and analyses on the future of money. Stay up-to-date with live prices, charts, and trading options for the top exchanges. Keep track of the day's top cryptocurrency gainers and losers, as well as which coins have experienced gains and losses in the past 24 hours.
Trust Coinsurges as your go-to source for all news and updates in the industry.

Prepare For A Solana Sell-Off: How Grayscale’s 2025 Unlocks Could Shake The Market

Share This Post

On Thursday, as the broader cryptocurrency market showed signs of recovery, Solana (SOL), one of the leading altcoins, surged past the $200 mark, reflecting an 8% increase over the past 24 hours. 

This upward momentum brings the sixth-largest cryptocurrency by market capitalization closer to its all-time high achieved in November 2024. However, market experts caution that Solana may face significant pressure in the coming days.

A Double-Edged Sword For Solana Investors

Ben Lilly, a market analyst at Jarvis Labs, recently highlighted potential risks tied to the “Grayscale Effect.” In a social media post, he warned that the upcoming Grayscale SOL tokens unlock could create substantial selling pressure on the altcoin. 

Grayscale, a prominent digital asset management company, enforces a policy to protect assets for 12 months following acquisition. As the two major unlocking periods near—January 24 to February 2 and July 24 to August 7—Lilly warns that investors should stay alert.

The mechanics of the Grayscale Trust are similar to those seen in the past with the Grayscale Bitcoin Trust (GBTC). In that case, investors would purchase Bitcoin (BTC) through Grayscale, which would hold the assets for a period before issuing shares. 

This created a premium, where the shares traded at a higher price than the actual Bitcoin price, leading to significant market rallies. 

However, when that premium disappeared, it marked the peak of the market in 2021, resulting in a cascade of failures for firms like Three Arrows Capital, BlockFi, Celsius, and Voyager.

Potential Price Drop Ahead For SOL’s Price

Lilly points out that Grayscale is now executing a comparable strategy with Solana, and the upcoming unlocks could mirror the past volatility seen in the crypto market. 

The analyst notes that previous large purchases of SOL tokens saw private placements unlocked from late July 2024, during which the price dropped by 40% in just ten days. 

The concern is that the same trend may emerge with the January 2025 unlocks, potentially leading to a significant sell-off. The analysis suggests that when investors who benefited from the premium in the past go to sell their holdings, they may flood the market, creating downward pressure on the SOL price

Lilly recommends that Solana holders consider selling in advance of the January 24 unlock date, as this could mark a critical turning point for the asset.

While the Grayscale Trust for Solana is relatively small compared to the overall market cap of SOL, the potential impact on price cannot be overlooked. 

According to Lilly’s analysis, historical trends indicate that even small unlocks can significantly influence market behavior. He reassures that while the upcoming sell pressure may not lead to catastrophic losses, it could result in local tops and a decrease in premiums.

Solana

As of this writing, SOL is priced at $205, decreasing slightly more than 20% from its peak of $263 attained on November 24 last year.

Featured image from DALL-E, chart from TradingView.com

Read Entire Article
spot_img
- Advertisement -spot_img

Related Posts

Mining Milestone: Bitcoin’s Hashrate Soars to Unprecedented Heights in the New Year

On the third day of 2025, Bitcoin’s hash rate soared, registering between 813 and 823 exahash per second (EH/s) This impressive peak is an ideal start to the New Year Bitcoin Begins 2025 with

Cardano (ADA) Rallies Above 100-Day SMA As Bulls Aim For $1.26

Cardano (ADA) has surged past the 100-day Simple Moving Average (SMA), marking a pivotal moment in its price action and reigniting bullish optimism in the market This critical breakout signals a

Bitcoin Next Bullish Move In Sight? Expert Lays Out Path For BTC To $155,000 Milestone

Bitcoin has witnessed renewed upside momentum following the start of the New Year, sparking optimism about its upward trajectory in the coming days With the flagship asset gaining traction, several

7 New Cryptocurrencies You Should Know About in January 2025

The crypto and meme coin market is rebounding Top gainers in the last 24 hours include $FOFAR (+184%), $CUMMIES (+88%), and $CARLO (+68%) Even trendsetters like PEPE and Dogecoin are in the green,

Bitcoin genesis block anniversary marks 16 years of financial revolution

The crypto world is celebrating 16 years since Bitcoin’s Genesis block was mined on Jan 3, 2009 This landmark event not only marked the birth of the top digital asset but also laid the

XRP Price Predicted to Hit $8 by 2025, Here’s Why

The post XRP Price Predicted to Hit $8 by 2025, Here’s Why appeared first on Coinpedia Fintech News XRP, Ripple Labs’ native token, appears to be leading and outperforming major assets like