Solana’s price continues to struggle under pressure from the growing memecoin market despite showing resilience following its largest-ever token unlock.Solana (SOL) fell over 45% since the Official Trump (TRUMP) memecoin was launched, from over $261 on Jan. 18 to $143 on March 2, TradingView data shows.The growing investor appetite for memecoins may be limiting Solana’s price performance, according to Dan Hughes, founder of the decentralized finance platform Radix.SOL/USDT, 1-day chart. Source: Cointelegraph/TradingViewMemecoins “don’t tend to draw in much external capital flow; instead existing eco-system capital “round-robins” from one meme to the next,” Hughes told Cointelegraph, adding:“Even in the case of TRUMP, most of the inbound liquidity was outflow from other crypto assets, people selling their crypto portfolio to buy TRUMP in extreme FOMO [fear of missing out].”“You can see the effect in the market, where for a few days everything was red except TRUMP and Solana, and it was amusingly labeled the liquidity vampire,” he added.SOL/USDT, 3-month chart. Source: Cointelegraph/TradingViewMemecoins may be attracting a significant share of the newly entering liquidity from Solana. Circle minted over $8.75 billion worth of USDC (USDC) since Jan. 1, according to Lookonchain, yet Solana’s price fell over 24% despite the new liquidity.Related: Wintermute withdraws $38M SOL from Binance ahead of $2B Solana unlockStill, Solana’s price managed to recover above $140 despite experiencing a $2-billion token unlock, which released over 11.2 million SOL tokens into circulation on March 1 as the biggest token unlock for Solana.Industry watchers were concerned about a significant downside move for SOL since a large amount of the unlocked tokens were purchased at $64 per SOL in FTX’s auctions by firms such as Galaxy Digital, Pantera Capital and Figure.Related: Binance is not ‘dumping’ Solana and other token holdings — SpokespersonMacro events, rug pulls are limiting institutional crypto investmentExternal macroeconomic factors and recent security incidents also continue limiting the upside of the crypto market, said Hughes, adding:“Events on the world stage are having a greater impact than in previous cycles. A much larger ratio of invested capital is institutional, who are much more cautious, having to consider a wider set of markets, factors and variables when making decisions […].”“Couple that with the exhaustion of continued rug-pulls, hacks, losses, it will take some time for the remaining dust to settle and the mojo to come back,” he said.Investor sentiment is still recovering from the $1.4 billion Bybit hack, which occurred on Feb. 21, marking the largest hack in crypto history.Magazine: ETH whale’s wild $6.8M ‘mind control’ claims, Bitcoin power thefts: Asia Express
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