Why Solana Price Is Falling Suddenly?

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Solana’s price has recently dropped below the critical $125 support level, sparking concern among investors and crypto market observers. The sudden decline comes amid increased activity from wallets historically linked to FTX and Alameda Research—entities whose asset liquidations have long been a source of market pressure for SOL holders.

These movements are widely believed to be part of an ongoing effort to liquidate holdings for creditor repayments following FTX’s collapse. The timing and scale of these transactions have intensified bearish sentiment, contributing to Solana’s current price struggles despite broader market optimism.

FTX and Alameda Research Transactions Fueling Market Downturn

On March 13, Solana experienced a sharp 5% drop in a single day, coinciding with a major token transfer from an Alameda Research-linked wallet. According to data from Arkham Intelligence, over $23 million worth of SOL was unstaked and distributed across 38 separate addresses.

ARKHAM ALERT: ALAMEDA ADDRESS JUST UNSTAKED $23M SOL TO 38 NEW ADDRESSES
An FTX/Alameda staking address received $22.9M SOL from a staking unlock and immediately redistributed the tokens to multiple known recipient addresses.

This move followed earlier signs of selling pressure from FTX-affiliated wallets, raising alarms about further supply entering the market. When large volumes of tokens are unstaked and moved, it often signals an intention to sell—especially when those tokens have been locked for extended periods.

👉 Discover how major wallet movements can impact market trends and what to watch next.

The market reacted swiftly. Traders and long-term holders grew cautious, fearing that additional unstaking could trigger sustained downward price action. With these funds now spread across numerous addresses, the risk of gradual or sudden dumping on exchanges like Binance or Coinbase increases significantly.

Arkham Intelligence emphasized that many of these recipient wallets have a history of transferring SOL to centralized exchanges, reinforcing concerns about growing sell-side pressure.

A History of Solana Unstaking Linked to FTX

The March 12 transaction is not an isolated incident. Since November 2023, FTX and Alameda Research have collectively unstaked approximately 8 million SOL tokens, valued at nearly $1 billion at current prices. A significant portion of these tokens has already been sold through major trading platforms, adding consistent downward pressure on Solana’s price.

One of the most impactful events occurred in early March when over 3 million SOL tokens—worth around $432 million—were unlocked from staking positions. Despite favorable macroeconomic signals at the time, including cooling U.S. inflation data (CPI and PPI), Solana failed to gain momentum.

Compared to other altcoins like XRP and ADA, which showed stronger rebounds during the same period, Solana lagged noticeably. This underperformance highlights the unique weight that FTX-related liquidations place on SOL’s market dynamics.

Ongoing Risk: 5.5 Million SOL Still in Play

Currently, an estimated 5.5 million SOL tokens, valued at approximately $693 million, remain under the control of FTX and its associated entities. These assets are still subject to future unstaking or direct sale as part of the bankruptcy resolution process.

Until this overhang is fully resolved, market participants are likely to remain hesitant in accumulating SOL at scale. The fear of sudden large-volume sales continues to suppress bullish sentiment, even amid improving overall crypto market conditions.

👉 Stay ahead of market-moving events and track whale activity in real time.

This lingering uncertainty creates what analysts call a “sell-side overhang”—a persistent threat of supply flooding the market without immediate catalysts for demand to absorb it. As long as this imbalance exists, Solana may struggle to reclaim strong upward momentum.

Technical Outlook: Support Levels and Bearish Patterns

From a technical analysis standpoint, Solana’s price trajectory remains bearish. After briefly reclaiming the $131 level, SOL faced strong resistance and reversed sharply downward, breaking below the $125 support zone—a level now seen as critical for near-term direction.

If Solana fails to stabilize above $120–$125, further downside could unfold. Some analysts point to an Elliott Wave pattern suggesting a potential bottom near $112, which might serve as a temporary floor before any recovery attempt.

Crypto analyst CryptoUB noted repeated rejections at the $127 level, calling it a pivotal zone for traders:

“Above = longs, Below = shorts.”

This indicates that price action around this level could determine whether bulls or bears take control in the coming days. Additionally, consolidation patterns visible on both 4-hour and daily charts suggest heightened volatility ahead.

Another market observer, CW8900, highlighted a significant sell wall around $180, indicating strong resistance if Solana ever attempts to rally back toward previous highs. However, there is also a visible buy wall forming near current levels, offering some support against steep declines.

This dynamic setup implies that while downside risks dominate in the short term, a decisive breakout above key resistance could reignite bullish momentum—especially if FTX-related selling subsides.

👉 Learn how technical patterns and order book data can help predict price reversals.

Frequently Asked Questions (FAQ)

Q: Why is Solana price dropping suddenly?
A: The recent drop is primarily driven by large-scale unstaking and fund redistribution from wallets linked to FTX and Alameda Research. These actions signal potential sell pressure, triggering investor caution and accelerating downward movement.

Q: Are FTX-related sales still affecting Solana?
A: Yes. Since late 2023, FTX and Alameda have unstaked nearly 8 million SOL tokens (~$1B). Around 5.5 million SOL remain under their control, posing continued risk of further liquidation.

Q: What is the next key support level for Solana?
A: The immediate support lies between $120 and $125. A break below could lead to a test of $112–$115, according to technical indicators and wave analysis.

Q: Can Solana recover if FTX stops selling?
A: Yes. Once the overhang of FTX-linked tokens is fully resolved, reduced sell pressure could allow organic demand to drive recovery—especially if broader crypto markets remain bullish.

Q: How does Solana compare to other altcoins right now?
A: Solana has underperformed peers like XRP and ADA due to its unique exposure to FTX liquidations. Other networks aren’t facing similar concentrated sell-offs, giving them stronger relative momentum.

Q: Is now a good time to buy Solana?
A: It depends on risk tolerance. While fundamentals remain strong long-term, short-term volatility from FTX-related activity persists. Investors should monitor unstaking trends and technical levels before entering positions.

Core Keywords:

Despite near-term headwinds, Solana’s underlying ecosystem continues to show strength—with active development, growing DeFi and NFT activity, and strong network performance. However, until legacy issues tied to FTX are fully resolved, price stability may remain elusive.

For traders and investors, staying informed about wallet movements, technical structures, and macro-level crypto trends will be essential in navigating Solana’s path forward.