Solana’s price has dropped 8.8% in the past 24 hours, hitting $169.01, marking its lowest point since mid-December. This comes amid a wave of controversies surrounding meme coins like LIBRA and Harry Bolz (HARRYBOLZ) that are based on Solana’s blockchain. Solana has fallen 16.5% in the past week and 39.1% since last month, according to CoinMarketCap data.
LIBRA, a Solana-based meme coin, quickly gained attention after launching on Friday, briefly reaching a market cap of over $4 billion. However, it soon crashed, shedding more than $4.4 billion in value just hours after its peak. The token’s rise and fall were tied to its endorsement by Argentine President Javier Milei. The endorsement led to fraud charges against Milei, filed by his political opponents. The complaint accuses him of misleading the public by promoting the token and it alleges insider trading. Further controversy has surrounded LIBRA, with blockchain investigators linking its backers to those behind Melania Trump’s meme coin, MELANIA.
Harry Bolz (HARRYBOLZ), another meme coin on Solana’s blockchain, saw an incredible surge of 54,637% before crashing. The brief surge was sparked when Tesla CEO Elon Musk changed his name on X (formerly Twitter) to match the coin. Another Solana meme coin, Vigilante (VIGI), surged and then collapsed by 69% after a man was arrested while trying to promote the coin by climbing the Hollywood sign.
Beyond meme coins, other factors are adding to the negative sentiment around Solana. A major event on March 1, when 11.2 million SOL tokens (worth $2.06 billion at current prices) will be unlocked, is creating concern. These tokens were acquired by firms during the liquidation of FTX’s assets, and their release may lead to large-scale selling of SOL, putting additional pressure on the price.
However, there is still some optimism regarding Solana’s long-term potential. Recently, the network marked one full year without a network outage, something that had been a recurring issue in the past, particularly in 2022. Despite the current drop in SOL’s price, some analysts believe Solana’s future remains bright. VanEck, a prominent asset management firm, has predicted that SOL could rise to $520 by the end of 2025. This is based on expectations that Solana will capture more of the smart contract blockchain market and increase its share of decentralized exchange (DEX) volumes and active users.
Although Solana faces challenges in the short term, including the issues with meme coins and the upcoming token unlock, some investors remain optimistic about its longer-term prospects.
