Amid the ongoing wider consolidation in crypto markets, Solana investors appear to lose interest. Today, a crypto whale made a huge offload of Solana tokens to Binance, a move that could be bearish for SOL’s price.
Massive transfer of SOL to Binance
Today, January 11, Whale Alert spotted a huge transfer of Solana tokens to the Binance exchange. According to its reported data, an unknown wallet made a transfer of 149,999 Solana (worth $27,919,102) to Binance.
Such large-scale transaction is normally affiliated with whales. The unknown wallet means that the owner cannot be identified. These are wallets that are normally not linked to any recognized centralized platform and therefore possibly belong to traders’ personal wallets.
It seems that the whale transferred the tokens from his private cold wallet to Binance for transaction purposes. This form of transaction is typically known as an exchange inflow. Traders normally make exchange inflows when they intend to use trading services that centralized exchanges offer.
On the other hand, this whale’s activity signals potential Solana sales. It indicates a general market sentiment, as investors appear unwilling to hold for long, possibly due to price decrease concerns or other interest.
Yesterday, on Friday, Jan 10, another Solana whale deposited $45.7 million Solana from his self-custody wallet to Binance exchange. Market activities of this nature end up hurting the token’s price. They also give signals about potential sell-offs among large token holders.
Solana price updates
Cryptocurrency markets are currently experiencing challenges (due to global economic conditions), which have triggered the majority of asset prices to lose strength.
Although Solana had been strong when the new year began, it recently lost gains. It is currently trading at $186.93, down 2.5% over yesterday, which signals increased selling pressure among big investors.
SOL’s performance this week has been dull amid increased selling pressure facing global crypto markets. The token price has been down 13.60% in the last seven days, meaning that is underperforming the global digital asset market which is down 6.30% currently.
Its decline mirrors the struggles in altcoin markets, which slumped deeper after the US court permitted the DOJ to sell $6.5 billion Bitcoin confiscated from the online black market, the Silk Road.
Also, positive market sentiment on Solana seems to have shifted. The token’s recent proposal to implement a new hashing system has become a bone of contention. Some community members feel that the proposed upgrade could have a negative effect on crucial network components like rollups and light clients.
These components are important for scaling DeFi on the SOL network, as they facilitate off-chain computations, reduce transaction costs, and maintain high decentralization and security.
On Tuesday, January 7, SOL developers recommended the implementation of the new hashing system to alter how the Solana protocol tracks and authenticates user accounts. The plan is part of efforts to address scalability challenges emerging as a result of mass usage.
However, Solana’s price remains resilient due to the consistent growth of its network. Several meme coins operating on the Solana network imply that increased application and utility help to bolster the SOL ecosystem and its native token.
This resilience is also due to Solana being a prominent player in the on-chain and DeFi activity in the crypto landscape. Last month, it generated 43% more trading volume than the Ethereum network across various DEXs.
