Despite a US court granting FTX permission to liquidate its assets, the price of Solana (SOL) has surged by 4.62% to reach $18.90, with a market capitalization of $7.79 billion. FTX is gearing up to liquidate a portfolio of assets valued at $3.4 billion, with significant holdings in Solana (SOL), Bitcoin (BTC), and Ethereum (ETH). This portfolio also includes various other digital assets such as XRP, Wrapped Bitcoin (WBTC), and Aptos (APT).
Solana (SOL) used to be a major reserve currency for FTX until its bankruptcy in November 2022. In an attempt to protect its native FTT token, FTX sold substantial amounts of SOL. Out of its total cryptocurrency holdings, FTX still holds $1.2 billion worth of Solana.
Despite the court’s approval for FTX to sell its crypto holdings, the process will be gradual and conducted over the next few years. FTX has enlisted the services of Galaxy Holdings, led by Mike Novogratz, for the liquidation process. Initially, FTX can sell assets worth up to $200 million per week to meet its obligations.
Solana (SOL) Price Resilience Amid FTX Asset Liquidation Approval
While this gradual selling may introduce some additional selling pressure in the markets, it’s likely that this impact has already been priced in by current market participants. It’s noteworthy that Solana experienced significant selling activity in the past week, which could indicate a “sell the rumor, buy the news” scenario.
Tron founder Justin Sun has called on the crypto community to unite and collaborate to minimize the selling impact of FTX’s holdings. This collective effort may help mitigate any potential adverse effects on the market.
In summary, despite the court’s decision to allow FTX to liquidate its assets, the price of Solana has shown resilience, potentially indicating that the market had already anticipated this development. The gradual nature of the liquidation process and community efforts to reduce selling impact could contribute to Solana’s stability in the face of FTX’s asset liquidation.