NAIROBI (Coinchapter.com) – Bankrupt crypto exchange FTX will auction off more of its Solana (SOL) tokens this week. The sale could impact SOL prices, but also presents a potential buying opportunity. This follows FTX’s liquidation of $1.9 billion in SOL holdings in March.
According to Bloomberg, the auction has a Wednesday deadline, with results expected to be announced on Thursday. This move comes after FTX disclosed the sale of approximately $307.6 million worth of SOL and ZBC tokens in March, further liquidating the exchange’s assets.
Industry figures like Figure CEO Mike Cagney have already confirmed their interest. Cagney expressed optimism about the auction’s outcome, citing positive results from previous FTX sales.
Solana’s Network Performance Fuels Optimism
The upcoming auction coincides with a notable surge in Solana’s network performance. Data from Artemis indicates that Solana accounts for over 30% of daily transactions across major layer 1 and layer 2 networks, positioning it favorably against competitors. This high transaction activity has led to a 417% increase in transaction fees, surpassing BNB Chain and Tron, according to The Block Pro.
Furthermore, Solana’s Total Value Locked (TVL) has jumped from $3.36 billion on April 18 to $4.05 billion on April 23, marking a 19% rise. This increase in network utilization and price valuation underscores Solana’s growing dominance in the blockchain sector.
Technical Indicators Suggest Upside Potential
Moreover, the technical setup for Solana also hints at potential further price increases. On April 17, Solana found support at the $130 demand area and has been on an upward trajectory since. In fact, it recently surpassed the 50-day exponential moving average (EMA) at $156.42, a critical support level. Certainly, a daily close above this level could confirm the bulls’ control over the market and pave the way for further gains.
Moreover, the Moving Average Convergence Divergence (MACD) indicator shows a bullish cross on April 23, often seen as a buy signal. This suggests that Solana may be undervalued and ready for a rebound. If this trend continues, Solana could see a significant increase. It could potentially reach the $202 mark, corresponding to the neckline of the v-shaped recovery chart pattern.
Certainly, despite the optimistic indicators, risks remain. If Solana fails to maintain its position above the 50-day EMA, it might face a correction towards its 100-day EMA at $139 or even lower to $125. This highlights the volatile nature of cryptocurrency markets.
