A major Solana (SOL) token unlock event is set to introduce market volatility. Analyst Cheeky Crypto has announced plans to sell all their Solana holdings before March 1st.
The decision follows an upcoming release of 11.2 million SOL tokens, valued at approximately $2 billion. Market participants are watching how this influx will impact Solana’s price and overall sentiment.
The scheduled token unlock represents 2.31% of Solana’s circulating supply. Historically, large unlocks have led to price declines due to increased selling pressure. Cheeky Crypto points to past FTX-related liquidations as examples of how sudden supply surges have affected Solana’s price action.
Cheeky Crypto described the event as a “game-changer,” emphasizing how a multi-billion-dollar increase in supply could disrupt market stability. “Imagine having an extra $2 billion worth of tokens flooding the market—it disrupts the balance of supply and demand,” the analyst explained.
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Market Sentiment: SOL Bearish Pressure Builds
Solana has already experienced a 30% price drop over the past month. Data shows a 4:1 short-to-long ratio, with traders aggressively betting against the token.
Open interest in short positions has spiked, particularly after SOL lost support at $190. “Futures traders are clearly leaning bearish on Solana, aggressively shorting it ahead of the unlock,” Cheeky Crypto noted.
Despite the bearish outlook, some industry figures see a different scenario. Kelly from Galaxy Digital suggested the market could absorb the selling pressure.
Others pointed to potential catalysts like the Fire Dancer upgrade and possible ETF integration. “Despite the FUD, Solana has robust trading volumes, and upgrades like Fire Dancer could change its trajectory,” Cheeky Crypto added.
SOL Technical Analysis: Key Levels to Watch
If Solana fails to reclaim the $190 level by February 17, the analyst warns of a bearish shift in the 200-day exponential moving average. Support zones between $168 and $155 are now critical. “If we see a significant dip below $155, the bearish sentiment could accelerate even further,” the analyst stated.
On the upside, a successful absorption of the expected sell pressure could stabilize Solana’s price. New developments within the ecosystem could also help reverse the current trend.
Cheeky Crypto confirmed plans to sell all their Solana holdings before the unlock. If the price drops significantly afterward, a re-entry could be considered. “I’ve seen significant gains on my Solana position. I plan to liquidate before March 1st and re-enter if the price crashes,” the analyst revealed.
Traders are now evaluating short-term opportunities, while long-term holders must weigh the impact of Fire Dancer and other upgrades against potential downside risks.
Read also: How Many Litecoin (LTC) Tokens You Need to Become a Millionaire by 2026?
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