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The Abrupt 150% Decline in Solana’s Value: Causes, Impacts, and Potential Prospects

The Abrupt 150% Decline in Solana’s Value: Causes, Impacts, and Potential Prospects

Bitget-RWA2025/11/22 00:40
By:Bitget-RWA
The cryptocurrency sector is well-known for its dramatic price swings, and Solana (SOL) recently became the center of attention after reports of a 150% price crash in November 2025—later corrected to a —ignited widespread discussion. Although the initial figure was likely a misinterpretation, possibly combining losses from several periods, the 26% decline still marks a notable correction. This article explores the factors driving the downturn, examines its broader impact on alternative cryptocurrencies, and considers whether this presents a contrarian buying chance or a warning sign for investors.

Catalysts: Shifting Sentiment, Technical Developments, and Regulatory Changes

The primary cause behind Solana’s recent slide was a wider market downturn, which was intensified by

, a trading platform for Solana-based coins. Although this acquisition was intended to strengthen Solana’s trading ecosystem, it also brought uncertainty regarding token economics and liquidity for projects such as . The deal also underscored the increasing institutional involvement in meme coins, a niche often associated with speculative excess.

At the same time, Solana’s developer community revealed significant upgrades—Firedancer and Alpenglow—aimed at boosting network throughput and lowering latency,

. While these improvements promise greater scalability in the long run, they introduced short-term uncertainty as investors weighed the benefits of technical progress against immediate price movements. Delays in rolling out these upgrades also sparked concerns about execution risk, a common issue in blockchain initiatives.

Regulatory shifts added another layer of complexity. The introduction of the Bitwise

Staking ETF (BSOL), which under management within just 18 days, reflected growing institutional trust. However, the ETF’s rapid growth also highlighted the risks of staking: while it provides returns, it also brings operational challenges like slashing penalties and liquidity limitations .

Consequences: Liquidity Squeeze and Contrarian Opportunities

The 26% correction has revealed Solana’s susceptibility to liquidity disruptions. Open interest (OI) in SOL futures has

from $10 billion at the start of November, a decline that could worsen if risk aversion continues. Retail interest has also diminished since mid-October, when a historic liquidation event erased $1.2 billion in positions . For larger investors, this liquidity shortage raises the risk of increased slippage and higher transaction costs if prices fall further.

However, the downturn has also created new dynamics. Upexi, a leading Solana treasury,

, signaling strong belief in Solana’s future. Additionally, inflows into Solana-related ETFs have , indicating that some institutional players see the price drop as a buying window. The $144–$150 price band, now a key support zone , may become the main battleground between bullish and bearish traders.

Risk Assessment: The Contrarian’s Crossroads

For those taking a contrarian approach, Solana’s recent fall presents a dilemma. On the positive side, the network’s technical advancements and growing institutional participation through ETFs point to a solid foundation. Conversely, unresolved regulatory questions and fragile liquidity remain concerns. With the RSI at 38

and the MACD approaching the zero threshold , bearish momentum appears to be fading, but a decisive move above major moving averages ($173, $180) is needed to confirm a trend reversal.

The risks are considerable. While staking yields are appealing,

, they come with operational hazards. Moreover, the broader altcoin space is still “developing,” where thin liquidity can magnify losses . For cautious investors, the recent decline might be a cue to exit. For those with a longer-term outlook, it could be a chance to invest in a project with significant transformative potential at a discount.

Conclusion: Time to Enter or Exit?

Solana’s 26% slide exemplifies the dual nature of altcoin investing: volatility can be both a risk and an opportunity. While immediate challenges—such as liquidity shortages, regulatory uncertainty, and delayed upgrades—are real, the network’s technical progress and institutional support suggest underlying strength. Investors must balance their risk appetite with the potential for a rebound, especially if upgrades like Firedancer and Alpenglow meet expectations. For now, the $144–$150 level will serve as a crucial test of Solana’s resilience as a leading blockchain platform.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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