Solana has fallen by 6%, mirroring a broader market downturn as increased liquidations add to overall volatility.
Solana (SOL) experienced a 6.02% decline on Monday, May 19, falling to $163.97, in line with a broader downturn across the cryptocurrency market. The drop comes amid rising market volatility, largely driven by a surge in liquidations and ongoing macroeconomic concerns.
In the past 25 hours, total long and short liquidations across the reached $642.65 million, with the Solana accounting for $23 million of that. Most liquidations were long positions, indicating futures traders may have been overly optimistic about recent market performances.
Liquidations and Unstaking Pressure Drive Solana Lower
A sharp rise in liquidations has contributed significantly to increased market volatility. When positions are liquidated, more tokens enter circulation, often leading to selling pressure and a drop in prices. In Solana’s case, this dynamic combined with ongoing unstaking activity has pushed its value lower, in line with the broader market correction.
Despite recent declines, many traders remain optimistic about the potential onset of an altcoin season, which could favor Solana. BitMEX co-founder Arthur Hayes has suggested that this phase might begin once Bitcoin reaches $110,000, potentially leading investors to rotate profits into high-growth altcoins like Solana.
There are also encouraging developments specific to Solana. The recently launched 2X Solana ETF has attracted $30 million in inflows since February, signaling growing investor interest. This momentum could build further if spot Solana ETFs receive approval in the U.S., making it easier for traditional investors to gain exposure to the token and possibly driving future price gains.
