No, Solana (SOL) Won't Crash, FTX's 'Liquidation' Isn't What You Think

The crypto community has been buzzing about FTX's supposed "liquidation" of Solana (SOL) tokens. But let's set the record straight: this is not a fire sale, and it is definitely not a sign that Solana is crashing.

First off, the wallet in question belongs to Alameda and holds a staggering 26,740,743 staked SOL, locked until 2025-2028. What is up for grabs in the FTX liquidation is not these SOL tokens but the keys to this wallet. Only the future key holder will have the ability to unstake these tokens when the time comes.

Now, you might be wondering about the seven million SOL and Wrapped SOL (WSOL) that FTX/Alameda reportedly holds. Well, those have already been presold to the Solana Foundation. When you hear about transfers happening later this week, do not jump to conclusions. The 26 million SOL remain locked, and the seven million SOL is already spoken for.

A glance at Solana's price trends over the past month shows a range between $19.76 and $24.69. While the price has seen some fluctuations, there is no drastic drop or spike that would indicate impending doom. The market seems to be treating Solana with a level of stability, despite the surrounding chatter.

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What is the takeaway here? Simple. Do not let the term "liquidation" throw you off. FTX is not dumping SOL tokens en masse. The locked SOL tokens are staying put until 2025-2028, and the keys to that treasure will change hands — not the treasure itself.

In a market that thrives on speculation, it is crucial to separate the wheat from the chaff. Right now, the chaff is the misconception that Solana is in trouble because of FTX's actions. The reality? Solana is holding its ground, and this "liquidation" is more of a key exchange than a token dump.