Why Is Solana Crashing? Will $SOL Recover? Key Price Triggers Explained

Table Of Contents

Why Is Solana Falling? Key Reasons Behind the $SOL Crash
Will Solana Go Up? Key Factors That Could Trigger a Rebound
Final Thoughts: Should You Buy the Dip?

Solana (SOL) has recently faced a sharp decline, leaving investors questioning its future trajectory. As of now, Solana is trading at $159.02, marking a 7.77% drop in a day and a 12% weekly decline. With a market cap of $78.08 billion and a 24-hour trading volume of $2.96 billion, many are asking: Why is Solana going down? And will it recover?

Why Is Solana Falling? Key Reasons Behind the $SOL Crash

Several major events have triggered Solana’s recent price decline:

1. Solana’s Involvement in the Bybit Hack

One of the biggest concerns is Solana’s indirect connection to the Bybit hack—one of the largest crypto breaches ever. On February 21, hackers stole $1.5 billion, causing a $4 billion withdrawal frenzy on Bybit. Reports suggest that the infamous Lazarus Group, a North Korean hacking organization, laundered funds through Solana-based meme coins.

Blockchain analyst ZachXBT revealed that Lazarus minted over 500,000 Qin Shihuang coins on Pumpfun, a Solana-powered trading platform. In just three hours, these coins reached $26 million in trading volume, raising concerns over Solana’s security. Although Pumpfun removed the token, the damage was done—adding pressure to Solana’s price.

2. Massive Solana Sell-Off by Binance

Another major reason why Solana is crashing is Binance’s large-scale $SOL liquidation via Wintermute, a well-known market maker. In just four hours, Binance’s hot wallet transferred between 6,700 to 23,900 SOL ($1.07M–$3.83M) to exchanges like Kraken, Coinbase, and Wintermute.

These aggressive sell-offs have flooded the market with excess supply, contributing to Solana’s downward momentum. This aligns with broader market trends, where liquidity providers adjust their positions, causing increased volatility.

3. The Libra Coin Scam & Argentine President’s Controversy

Adding fuel to the fire, Solana’s reputation took another hit with the Libra Coin scandal involving Argentine President Javier Milei. On February 14, Milei promoted a Solana-based meme coin, Libra, claiming it would fund tech startups. However, within hours, the coin plunged 94% after large investors dumped their holdings, leading to allegations of a “rug pull.” Milei later deleted his endorsement, claiming he was unaware of the project’s true nature. This controversy further hurt investor confidence in Solana.

Will Solana Go Up? Key Factors That Could Trigger a Rebound

Despite the recent setbacks, several positive developments suggest that Solana could recover in the coming months:

1. Solana ETF Filing by Franklin Templeton

One of the most bullish signals for Solana is Franklin Templeton’s recent S-1 filing with the SEC for a Solana ETF. This move highlights growing institutional interest and could attract more mainstream investors, boosting Solana’s long-term value.

2. Solana’s Increasing Adoption

Solana continues to be a top contender in blockchain technology, offering lower fees and faster transactions than Ethereum. Several high-profile meme coins, including OFFICIAL TRUMP (TRUMP), Bonk, and MELANIA, are running on Solana, further strengthening its ecosystem.

3. Solana Price Prediction: Short- & Long-Term Outlook

Crypto analyst Ali Martinez predicts that Solana is preparing for a 13% price move. Based on a symmetrical triangle pattern, Solana could either break upwards to $193.5 or drop further to $149.

Long-term forecasts suggest that Solana could trade between $250 and $300 by 2025, with potential highs of $500 before 2030. Some optimists even speculate: Will Solana reach $10,000 in the future? While this is ambitious, Solana’s fundamentals remain strong.

Final Thoughts: Should You Buy the Dip?

Solana’s recent crash was triggered by external controversies, including the Bybit hack, Binance’s sell-off, and the Libra Coin scandal. However, the Solana ETF filing, increasing adoption, and strong fundamentals indicate potential for a rebound.

Investors should monitor market conditions closely, as Solana’s ability to recover will depend on broader crypto trends and continued institutional support. While short-term volatility is likely, Solana remains one of the strongest blockchain ecosystems with long-term potential.