Solana’s terrible, no-good, rotten run seems to know no end.
SOL ($151.50) plummeted another 9% on Monday, to just under $153.
The cryptocurrency has tumbled more than 37% in the last 30 days, which is worse than Ethereum’s 19% decline, according to CoinGecko.
The reason, it appears, is the product that used to be a Solana strength — memecoins.
By embracing memecoins, Solana’s market value raced ahead of rivals in 2024 and spurred speculation, yet again, that it could leapfrog Ethereum.
Now a string of scandalous memecoin releases have drawn serious blowback.
Outrage
On February 14, the Libra memecoin promoted by the crypto-loving president of Argentina, Javier Milei, cratered shortly after insiders made a killing.
The episode triggered outrage in the South American nation and the crypto market writ large. And Solana, as it’s done numerous times in the past year, hosted Libra.
Even so, some analysts expect Solana to weather the storm.
Carlos Guzman, an analyst at market-making firm GSR, expects other applications on Solana to thrive, including offerings in the payments, DeFi, and artificial intelligence sectors.
“There are additional reasons to be optimistic about Solana, including a possible SOL ETF and coming regulatory clarity, which are likely to boost investor confidence,” Guzman told DL News.
Yet there’s no getting around the fact that Solana is enduring its worst round of controversy since the network suffered a number of outages in 2022 and 2023.
Solana did not respond to a request for comment.
sold all my $sol yesterday.
been a holder since early 2021, and remain bullish long-term.
but all i care about is defi
and i want to be where the defi yield is—on @berachain.
where the novel defi chains are—on @celestia.
and where the defi fundamentals are—on @ethereum.
gm
— david phelps (@divine_economy) February 18, 2025
In January, critics lambasted President Donald Trump and his wife, Melania Trump, after they launched memecoins on Solana. Both the Trump and Melania coins skyrocketed before cratering.
Hawk Tuah effect
The token launched by Haliey Welch in December, the internet celebrity behind the raunchy “Hawk Tuah” meme, met a similar fate.
“When Melania launched after Trump, it brought the realisation home that some teams were purely extractive and really stole the thunder of the Trump launch,” Chris Chung, founder of Solana trading platform Titan, told DL News.
“The last wave with the Libra coin was the nail in the coffin.”
Solana’s dependence on Pump.fun, a memecoin factory that makes it easy to launch the tokens, isn’t helping.
When memecoins surged on January 23, tokens launched on Pump.fun made up more than 75% of all the tokens introduced on the entire Solana network, according to data from Solscan and Dune.
‘A permissionless market is one thing, but validating scams kills the other asset classes.’
Ivan,Gearbox Protocol
Many crypto investors are not amused at the cascading losses memecoins are generating.
More than 86% of wallets that bought Milei’s memecoin, for instance, ended up losing money, according to research from Nansen.
“Memecoins penetrated the mind share that was previously attributed to real projects,” Ivan, the pseudonymous cofounder of the decentralised finance project Gearbox Protocol, told DL News.
“A permissionless market is one thing, but validating scams kills the other asset classes.”
Turning a page
Solana’s leaders are scrambling to make adjustments.
Mert Mumtaz, CEO of Solana developer platform Helius, announced he was hiring a forensic researcher to help prevent fraudulent activity just days after Libra crashed.
Brian Armstrong, the CEO of Coinbase, said on X after the Libra plunge that “some memecoins have clearly gone too far,” and called on the industry to “purge the bad actors.”
Similarly, Edward Wilson, the marketing lead at DeFi project OneBalance, said cleaning up crypto’s act from chaotic memecoin launches must come from within the industry.
“There needs to be very strong pushback against these ideas and these products,” said Wilson. “They really do prey and are predatory.”
Debacle
As for Solana, GSR’s Guzman said very little has changed for the network’s prospects.
“Claims of Solana’s demise due to this debacle are exaggerated,” he told DL News.
“Memecoin mania would eventually die down given its zero-sum nature and the fact that most participants lose money.”
Liam Kelly is a Berlin-based reporter for DL News. Got a tip? Email him at [email protected]. creator solana token
