- Solana’s DEX volumes fell to a five-week low of US$2.61B, with on-chain activity down 28% and SOL ($168.74) shedding 14% in mid-Feb, reflecting broader market caution.
- Memecoin volatility, exemplified by the LIBRA crash, has worsened the sentiment, with repeated pump-and-dumps spurring waning interest in speculative tokens.
- Further pressure looms with an 11.2M SOL unlock on March 1, stemming from FTX ($0.00)’s bankruptcy auction and prompting investor caution until the tokens are fully released.
Solana’s decentralised exchange (DEX) activity has continued its steady decline, dipping to US$2.61B (AU ($9.91)$4.09B) in volume on February 16 — its lowest point since mid-December.
Weekly figures compiled by DefiLlama reveal a total of US$20.2B (AU$31.9B) in trading volume by that date, marking a five-week downturn. This decrease aligns with broader market caution and a notable drop in on-chain transaction activity, which fell 28% to US$31.8B (AU$50B) by February 10.
Related: Elon Musk’s DOGE ($0.25) Takes Aim at US SEC Over Accusations of ‘Waste, Fraud, Abuse’
Similarly, Solana’s SOL shed 14% of its value between February 14 and 18, dropping to around US$169 (AU$266).
Solana’s Weekly Price. Source: CoinMarketCapRelated: After LIBRA Scandal, Kelsier Ventures Eyes Nigerian Expansion with New Solana Blockchain Project
Meanwhile, DEXs on Solana, Raydium, and Orca saw sharp contractions —over 45% and nearly 30%, respectively— while Meteora showed a contrasting 18% uptick, clocking in at US$658M (AU$1.35B) in volume versus Raydium’s US$836M (AU$1.30B) and Orca’s US$544M. (AU$850M).
While the timing coincided with the ill-fated launch of the Libra memecoin —an event that garnered attention due to involvement from Argentina’s President Javier Milei and ultimately crashed by 83%— market observers suggest that attributing Solana’s US$18B (AU$28.3B) market cap loss solely to memecoin speculation overlooks other contributing factors.
Anticipated SOL Unlock and Market Caution
Observers attribute part of the broader decline to waning interest in meme coin trading. What started as a flurry of excitement around novel, low-cap tokens appears to have cooled as traders face repeated pump-and-dump schemes, rug pulls, and concerns about insider maneuvers.
For instance, CryptoQuant analyst Axel Adler Junior highlighted how memecoin instability has further rattled the Solana ecosystem. The recent LIBRA incident just added more weight to the negative sentiment, contributing to a broader price slump in SOL, now off 40% from its January high.
Compounding these market pressures is the planned release of 11.2 million SOL on March 1. The tokens in question were sold off during FTX’s bankruptcy and later acquired by firms like Galaxy, Pantera, and Figure, prompting some investors to remain cautious until the unlock has fully played out.
The post Solana Faces Sharp Decline in DEX Volume and SOL Price Amid Market Uncertainty appeared first on Crypto News Australia.
