• The founders and developers are attempting to motivate users and help them weather the storm.
• However, more trouble may be in sight, as nearly every major cryptocurrency is down this week following FTX’s reveal.
• Solana has been hit particularly hard, falling 60% over the last seven days. This includes a 45% plunge in just the past 24 hours.
• Key founders of the blockchain network are attempting to salvage fading enthusiasm around the space as the ecosystem suddenly finds itself embroiled in crisis.
The cryptocurrency market is in the midst of a crisis, with prices plummeting across the board. Solana, a blockchain network that has lost over half its value in the past day, is seeing FUD being spread from users and developers as the founders of Solana-based projects attempt to motivate them and help them weather the storm. However, more trouble may be in sight, as nearly every major cryptocurrency is down this week following FTX’s reveal of liquidity problems.
Solana has seen a drop of 60% in value over the past week to a price that is currently $13.95 per token. Solana has seen this loss since the news of FTX’s liquidity issues broke. The Solana ecosystem has already faced so much uncertainty and doubt that it has become quite difficult to keep members of the Solana community motivated.
Sam Bankman-Fried has been associated with Solana for a long time now and invested in the project through his company Alameda Research. This connection has been detrimental to Solana since the revelations about and subsequent fall of FTX.
Since its all-time high of $260 Solana has slowly shed 95% of its total value this latest amount of loss does not bode well for the blockchain but there are some that believe this will not end things for the Solana ecosystem.
What is causing the market crash?
The cryptocurrency market as a whole is in turmoil following FTX’s reveal of its liquidity problems. This has caused a domino effect, with prices plummeting across the board. The problem appears to be stemming from a lack of liquidity, as many traders are selling off their assets in a panic. This has created a feedback loop, as the lack of liquidity drives prices down even further, leading to more selling and even less liquidity.
The FTT token as of now how has been damaged as it goes to zero. The original deal penned by Binance would have saved some of the situation but recently CZ backing out of the deal he claimed was “unsalvagable” has caused things in the crypto sphere to get even more hectic.
How are the founders of Solana responding?
The founders of Solana and many Solana-based projects are attempting to salvage fading enthusiasm around the space as the ecosystem suddenly finds itself embroiled in crisis. They are reaching out to users and developers in an attempt to motivate them with some saying Solana is fighting for its very soul. However, it remains to be seen whether their efforts will be enough to stem the tide.
Anatoly Yakovenko made a tweet in which he stated that Solana had no ties with Alameda Research and that the funds of the company are held in dollars. He stated he learned his lesson in 2018 during that crypto crash.
Raj Gokal, co-founder of Solana stated that this situation with FTX is Solana’s “crucible moment” meaning this moment will make or break Solana. This has not been the first of those moments for Solana however, which has had to come from the brink of destruction numerous times before, but Gokal is very positive about Solana during these times.
“The difference is there are 10x more of us to band together this time, next time, there will be 10x more, and each time, we’re stronger. The fundamentals are better. The same goes for crypto at large”Gokal
What does this mean for the future?
The cryptocurrency market is volatile and unpredictable. While it is possible that things will rebound in the near future, it is also possible that this is just the beginning of a long-term trend. Only time will tell how this situation will play out. In the meantime, it is important to exercise caution and not take on more risk than you can afford to lose.
Solana has had its price halved multiple times and each time it manages to survive somehow. The Solana ecosystem is very robust with many projects still underway as Anatoly Yakovenko stated that such projects can only be done on Solana. Only time will tell where Solana goes from here and the projects that are on their way via the Solana blockchain have the potential to save things.