Solana (SOL) has posted a 5% gain in the last 24 hours amid certain worrying developments in the crypto space. The United States on Wednesday published Consumer Price Index (CPI) data for August shows inflation rose from 3.2% to 3.7%, higher than analysts’ forecast.
Additionally, the bankrupt FTX exchange received court approval to liquidate its $3.4 billion crypto holdings as it seeks to offset its debts.
Normally, these types of developments are expected to cause selling pressure on crypto assets. However, most of the market remains afloat with slight gains in recent hours, while Solana has even started a rally, attracting a lot of attention from investors.
Interestingly, popular crypto analyst Michaël van de Poppe has given possible reasons why the crypto market may not move as widely expected.
Most of FTX’s Solanas are turned off and inaccessible – explains analyst
According to a X message Michaël van de Poppe stated on Wednesday that there should not be much reaction from the crypto market, despite the latest CPI data and court approval for the liquidation of FTX.
Related Reading: Solana’s Potential Rebound: Can Bulls Hit Their $30 Target?
The analyst explains that most of the Solana, which makes up the bulk of the FTX crypto holdings, worth $1.2 billion, is currently deployed and thus cannot be liquidated.
Van de Poppe states that there is only 7 million SOL available for FTX for liquidation, and most of these tokens have been sold in the past week. Given these circumstances, the analyst predicts that a “sell the rumor, buy the news” scenario is likely to occur.
FTX gets approval to sell $3.4 billion #Crypto asset and CPI data are coming in worse than expected
The markets aren’t falling that much, and there shouldn’t be much of that happening either.
The Solana, which represents $1.2 billion of FTX’s assets, is largely invested and cannot be sold.👇… pic.twitter.com/uKG9XefCzy
— Michaël van de Poppe (@CryptoMichNL) September 13, 2023
Regarding FTX’s other crypto holdings, Michaël van de Poppe states that the exchange is only allowed to sell $200 million worth of assets per week.
Furthermore, the calculation of this liquidation percentage takes into account current market prices; so it is unlikely to cause high selling pressure.
In addition to Solana, FTX is also looking to liquidate other assets such as Bitcoin (BTC), Ethereum (ETH), Aptos (APT) and XRP, among others.
Van De Poppe’s Take On CPI report
Michaël van de Poppe explains the crypto market’s reaction to the latest CPI data, explaining that while inflation rose higher than forecast in August, the core CPI value was 4.3% as expected, which is lower than the value of 4.7% in July.
Related reading: SOL Price Prediction: Solana Gets Hit and Could Plunge to $15
Therefore, the analyst assumes that the US Federal Reserve is unlikely to raise interest rates. This is because the Fed is known to focus more on core CPI figures, which provide a long-term perspective on inflation in the country.
At the time of writing, Solana is trading at $18.69, down 0.29% in the last hour based on data from CoinMarketCap. Meanwhile, the token’s trading volume has increased by 47.89% and is now valued at $446.52 million.
Solana (SOL) trading at $18.77 on the hourly chart | Source: SOLUSDT chart on Tradingview.com
Featured image from The Economic Times, chart from Tradingview
