SOLUSD – Weekly Chart
The price of SOL has collapsed from a test of the $280 level to eye the support at $119.41. This will be an important level for the coin going forward.
Solana is stumbling after the coin benefited from a memecoin craze surrounding the Trump election win. The President and the first lady both released tokens on the SOL blockchain. The crypto market overall is being hit by liquidations with Bitcoin down 12% in the last seven days, while Solana is down 22%, hitting its lowest price this year and a five-month low.
The drop was worsened by the coin’s association with celebrity-backed meme coin scandals, including $LIBRA, the cryptocurrency that quickly exploded to a nearly $5 billion market cap before crashing after promotion by Argentine president Javier Milei. The market bust angered investors and prompted an investigation into Milei’s involvement.
The $LIBRA incident “punctuated a period of very high activity among Solana memecoins that probably will discourage other political leaders from launching memecoins for now,” said Zach Pandl, head of research at Grayscale.
Solana became the premier blockchain for memecoin development because of its low transaction costs and high speed. SOL benefited from a platform named Pump.fun which allowed users to minth coins easier and saw 71,000 memecoins released in a single day.
US Bitcoin ETFs saw a record daily outflow of over $930 million on Tuesday with ether also suffering.
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