Author: Alex O’Donnell, CoinTelegraph; Compiled by: Baishui, Golden Finance
Data shows that as the memecoin scandal on the network continues to grow and market sentiment plummets, traders are increasingly preparing for a drop in Solana’s native SOL (SOL) token.
According to data service Coinalyze, the ratio of long to short SOL positions on cryptocurrency futures exchanges fell from 4 to 2.5 on February 17, meaning that the entire market tends to be bearish on SOL.
“The market has decided to be angry about Solana,” said anonymous cryptocurrency influencer Tyler Durden in a post on Platform X on February 17.
Citing data from Binance’s perpetual futures exchange, Durden said the ratio of short to long positions on Binance has risen to 4:1, indicating an excess of bearish bets.
Perpetual futures, or “perps,” are a type of derivative that allow traders to buy or sell an asset at a future date with no expiration date.
As of publishing time, SOL’s price is down nearly 6% on the day, according to CoinGecko.
Binance’s short positions outweigh its long positions. Source: Tyler Durden
The sudden rise of memecoins like Bonk and Dogwifhat has attracted billions of dollars to the Solana ecosystem.
Both dog-themed memecoins had market caps of more than $4 billion in December and January before retreating, according to CoinGecko. One U.S. exchange-traded fund issuer even proposed creating a BONK ETF.
Application revenue on Solana grew 213% in the fourth quarter of 2024, largely due to memecoin speculation, according to a report from crypto research firm Messari.
Now, insider selling and huge losses among retail investors are undermining confidence in Solana’s memecoin ecosystem.
“The amount of shitcoins out there right now is really hurting the SOL ecosystem,” said anonymous trader Runner XBT in a Feb. 16 post on X.
LIBRA loses $4.4 billion in market value in hours. Source: Kobeissi Letter
Libra (LIBRA), a cryptocurrency that Argentine President Javier Milei appears to be backing, lost about $4.4 billion in market value in the hours after its launch on February 14.
Milei initially promoted the token on X but later deleted his post. He is now facing a lawsuit in Argentina for allegedly misleading investors.
Since January, traders have lost about $2 billion across 800,000 wallets holding U.S. President Donald Trump’s official memecoin (TRUMP).
The fully diluted value of TRUMP has fallen about 75% from a high of more than $70 billion to around $17 billion as of Feb. 17, according to CoinGecko. About 80% of TRUMP’s supply is held by insiders.
Blockworks research analyst Westie said in a Feb. 16 article in X that the launch of the Trump Meme Coin is “the clearest example of insider gaming reaching its peak.”
Despite the slowdown in memecoin transactions, Solana’s revenue still exceeds Ethereum, the largest Layer 1 network by total locked value, according to DefiLlama.
MetaMask and Ramp Network now allow users to convert Ethereum from Layer 2 networks directly to fiat, cutting mainnet fees and delays. This simplifies Web3 access and bridges it with traditional finance.
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