On Tuesday, October 15, FTX and Alameda Research unstaked a significant 178,631 Solana (SOL), worth approximately $28 million, from a wallet associated with the now-defunct crypto exchange.
This large-scale unstaking has triggered concerns among market observers and Solana investors. There are fears that this move may lead to a selloff, potentially impacting SOL’s price.
Potential Selloff Looms for Solana Investors
The unstaked SOL tokens are likely to be distributed across multiple wallets. A considerable portion of these tokens is expected to be transferred to leading exchanges such as Binance and Coinbase, fueling speculation about a selloff that could further influence SOL’s market value.
FTX’s SOL Liquidation Strategy Analyzed
The regularity of these transactions has raised eyebrows in the crypto community. On-chain analysis, conducted by @EmberCN, indicates that these unstaked tokens, initially part of Solana’s proof-of-stake system, are consistently moved between the 12th and 15th of each month.
For example, in September, FTX unstaked over 530,000 SOL, valued at around $71 million. This pattern of monthly SOL redemptions averages around 176,700 tokens, equivalent to roughly $23.5 million. These frequent transactions have sparked concerns about possible further selloffs.
Despite these actions, FTX and Alameda Research continue to hold around 7.06 million SOL tokens, valued at approximately $945.7 million, as of mid-September. This ongoing token movement raises alarms about its potential effect on Solana’s ecosystem and the broader cryptocurrency market.
FTX’s Broader Liquidation Strategy Unfolds
The unstaking of SOL tokens forms part of FTX’s larger liquidation plan. Since the collapse of the exchange, FTX has been gradually selling off its cryptocurrency assets to repay creditors.
Between October and December 2023, FTX and Alameda Research transferred over 13 million SOL tokens to various crypto exchanges. Additionally, in April 2024, reports indicated that FTX sold over $1 billion worth of SOL tokens at discounted rates to raise necessary funds. These sales are a vital component of FTX’s bankruptcy proceedings.
FTX’s Bankruptcy Estate Continues Liquidation Efforts
In September 2023, a court approved FTX’s plan to liquidate up to $100 million in cryptocurrency each week, with the potential to increase this figure to $200 million if required. This court approval marked a significant milestone in the bankruptcy case.
On October 7, the United States Bankruptcy Court for the District of Delaware gave the green light to FTX’s reorganization plan. Under this plan, 98% of the company’s creditors will receive 119% of their approved claims within 60 days.
Recovering Funds for Creditors
FTX estimates the value of recovered assets to be between $14.7 billion and $16.5 billion, including those managed by Chapter 11 Debtors and liquidators from FTX Digital Markets (Bahamas) and FTX Australia. The continued liquidation of assets, including Ethereum and Polygon, is ongoing, with billions more still owed to creditors.
The post FTX Unstakes $28 Million in SOL, Triggering Fears of Another Selloff appeared first on Cryptonews.
