Solana 5% Drop Triggered by FTX Plan, Threatens $125M in Shorts

Solana dipped 5% for a day and the central reason was due to the news reporting the closing of user’s accounts on the FTX platform.

Traders at the moment are still under threat of a loss of about 125 million dollars if Solana is back again similar to its recent recovery pattern. Solana’s OI has encountered a drop of up to 40% in the last 30 days, now at just about $1.

Impact of Recent Solana Trades

Interpreting the $1.1 trillion worth of trades on May 9th as a general muddle and a lack of a strong propensity by the traders to take positive positions leading to the increase in its price.

Nonetheless, Solana has shown its ability to pick itself up fast in case of a downturn, and this can be devastating to the short positions which can result in a significant loss of short positions.

Over the past month, Solana got elements that made it swing by 5% in 24 hours. To visualize, both assets shared a similar scenario where the price declined on April 19th, but later it quickly shot up to $157 the day before Bitcoin halved.

Solana NFT policy maker Metaplex declared openly on Thursday that it has undergone a company-wide stretch of layoffs, as the contagion prompted by crypto exchange FTX’s fall last week goes on to circulate across the Web3 ecosystem.

An unrevealed number of Metaplex employees were pink-slipped today due to deteriorating market disorders for crypto mostly, and for Solana especially, the company’s co-founder and CEO Stephen Hess declared today in a tweet.

Factors Behind the Price Drop

There are a few reasons that may explain why Solana’s price has dropped. Moreover, the company FTX made an announcement on the same day about repaying the victims of its collapse by selling off its assets, which include Solana holdings, possibly directly correlating with the recent decline in Solana’s price.

As a result of the current downturn in the large majority of the cryptocurrency market, the Greed and Fear Index scored 13 points down over the past 24 hours to 54 when featured on May 9th.