Crypto Future's Poster Coin Solana Battered by FTX Collapse
Uncertainty stalks the blockchain that's been dubbed an "Ethereum killer" in the past.
Solana, a poster coin of the crypto future, is in trouble.
The cryptocurrency, which had been lauded by FTX's founder Sam Bankman-Fried, has been hit harder than any other major coin by the collapse of the exchange.
The Solana token, or SOL, has dropped 53.8% since the furor began unfolding on Nov. 2. By comparison, ether has fallen about 20% and bitcoin 19%.
"In the current crypto shakeout, the most unfortunate innocent victim is the Solana ecosystem," said Stefan Rust, CEO of blockchain wallet company Laguna Labs. He and several other crypto players said FTX and sister firm Alameda Research likely sold a large amount of the coin in an attempt to stay afloat.
Many investors and app developers look to be leaving the Solana blockchain, which is widely used for decentralized finance applications; the number of SOL coins deposited there has fallen to 24.74 million, some way south of the 68.2 million seen in June, according to data from aggregator DeFiLlama.
FTX and Alameda Research didn't respond to requests for comment. Solana co-founder Anatoly Yakovenko tweeted that development company Solana Labs didn't hold any assets on FTX and had enough financial runway for around 30 months. Another co-founder, Raj Gokal, said this was a "crucible" moment for the ecosystem, adding "each time, we're stronger".
Nonetheless, uncertainty stalks the blockchain that's been dubbed an "Ethereum killer" in the past because of its lower transaction fees, faster processing speed and potential to scale.
"It's not the end for Solana," said Adam Struck, at LA-based venture firm Struck Capital. "It has established itself as a thriving ecosystem and competitor to
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