Volatility
Recent U.S. regulatory filings indicate a widening investor base for Bitcoin ETFs, signaling growing institutional interest in the cryptocurrency sector. However, Bitcoin (BTC) faced continued downward pressure on Tuesday, nearing its lowest price in months.
Bitcoin and Market Performance
As of early afternoon trading, Bitcoin was priced at $93,600, reflecting a 2% decline over the past 24 hours and a 10% drop over the past week. The broader crypto market, represented by the CoinDesk 20 Index, saw a 4% decline within the same period. A significant contributor to this downturn was Solana (SOL), which plummeted 16%, largely due to turmoil in the memecoin sector. Solana’s price has dropped 35% over the past month, erasing all post-Trump election gains.
Bitcoin’s Path to $500K
Despite short-term price weakness, Standard Chartered’s Geoff Kendrick remains optimistic about Bitcoin’s long-term trajectory. Kendrick, who previously projected Bitcoin could surpass $500,000 by the time Donald Trump leaves office, expressed renewed confidence following the latest 13F filings on institutional ownership of spot Bitcoin ETFs.
Kendrick noted a shift in investor demographics, evolving from retail traders to hedge funds and now to banks and sovereign entities. He highlighted increased ETF holdings by financial institutions such as Goldman Sachs and the recent entry of Abu Dhabi into the Bitcoin ETF market.
“Going forward, we expect more long-term, buy-and-hold investors to enter the market, with Abu Dhabi’s initial position likely marking the beginning of broader sovereign participation,” Kendrick stated.
Solana’s Struggles
The decline in Solana’s ecosystem extended beyond SOL itself. Tokens tied to Solana-based platforms, including decentralized exchanges Raydium (RAY) and Jupiter (JUP), saw double-digit losses, while liquid staking service Jito (JTO) dropped 7%. These assets are now more than 30% below their Friday highs.
Solana’s recent troubles stem from the LIBRA token scandal, a high-profile pump-and-dump scheme that implicated key figures in the ecosystem, including Argentine President Javier Milei. Launched on Friday, LIBRA surged to a $4 billion market capitalization following an endorsement from Milei on X (formerly Twitter), in which he claimed the project would support small and mid-sized businesses in Argentina. However, the token swiftly collapsed, with insiders cashing out $100 million, prompting Milei to withdraw his endorsement. He now faces fraud charges and possible impeachment, while Solana-based DEX Meteora’s co-founder, Ben Chow, resigned after being linked to the launch.
“This is the latest sordid episode stemming from Solana’s memecoin sector,” observed Alex Thorn, head of firmwide research at Galaxy. Thorn noted that sentiment around memecoins has been deteriorating since the TRUMP token incident.
Upcoming Solana Unlock Raises Concerns
Further uncertainty looms over Solana as a major token unlock event approaches. Estimates vary regarding the exact number of tokens set for release, but one hedge fund analyst projected that approximately 15.725 million SOL—valued at around $2.5 billion—will enter circulation over the next three months. A significant portion of these tokens originates from the FTX estate’s holdings.
“If an unlock of this magnitude occurs, it could increase SOL’s circulating supply and impact market dynamics,” analysts at Tokenomist stated in an X post. “Historical precedent suggests large token unlocks often trigger heightened price volatility. However, the final details regarding the scale and timing of the unlock remain undisclosed by official sources.”
As institutional interest in Bitcoin strengthens, market participants continue to monitor regulatory developments and on-chain trends, with Bitcoin ETFs serving as a potential catalyst for long-term adoption.
