This article is available in Spanish.
On Thursday, as the broader cryptocurrency market showed signs of recovery, Solana (SOL) became one of the leading ones altcoinsrose past the $200 mark, reflecting an 8% increase in the past 24 hours.
This upward momentum brings the sixth-largest cryptocurrency by market cap closer to its all-time high set in November 2024. However, market experts warn that Solana could face significant pressure in the coming days.
A double-edged sword for Solana investors
Ben Lilly, a market analyst at Jarvis Labs, recently highlighted the potential risks associated with the “grayscale effect.” In one message on social mediahe warned that the upcoming unlock of Grayscale SOL tokens could cause significant selling pressure on the altcoin.
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Grayscale, a leading digital asset management company, maintains a policy to protect assets for twelve months post-acquisition. With the two main unlock periods close – January 24 to February 2 and July 24 to August 7 – Lilly warns that investors should remain alert.
The operation of the Grayscale Trust is similar to that in the past with the Grayscale Bitcoin Trust (GBTC). In that case, investors would buy Bitcoin (BTC) through Grayscale, which would hold the assets for a while before issuing shares.
This created a premium, with the shares trading at a higher price than the actual Bitcoin price, leading to significant market rallies.
However, when that premium disappeared, it marked the market’s peak in 2021, resulting in a cascade of failures for companies like Three Arrows Capital, BlockFi, Celsius, and Voyager.
Potential price drop for the price of SOL
Lilly points out that Grayscale is now executing a similar strategy with Solana, and that the upcoming unlocks may reflect the past inconstancy seen on the crypto market.
The analyst notes that previous large purchases of SOL tokens from the end of July 2024 unlocked private placements, with the price falling 40% in just ten days.
The concern is that the same trend could occur with the January 2025 unlocks, potentially leading to a significant sell-off. The analysis shows that when investors who have benefited from the premium in the past sell their assets, they could flood the market, putting downward pressure on the economy. SOL Award.
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Lilly advises Solana holders to consider selling before the January 24 unlock date, as this could mark a crucial turning point for the asset.
While the Grayscale Trust for Solana is relatively small compared to SOL’s overall market capitalization, the potential impact on price cannot be overlooked.
According to Lilly’s analysis, historical trends indicate that even small unlocks can have a significant impact market behavior. He reassures that while the coming selling pressure will not lead to catastrophic losses, it could result in top local prices and a drop in premiums.
At the time of writing, SOL’s price is $205, down just over 20% from the peak of $263 reached on November 24 last year.
Featured image of DALL-E, chart from TradingView.com
