Solana fell nearly 4% in one day amid fears of further selling by FTX, and current traders’ positions show $125 million at risk if it recovers as it has recently.
Additionally, the price drop comes alongside a roughly 40% drop in open interest (OI) in Solana over the past 30 days, to $1.78 billion as of May 9, according to CoinGlass data.
A sharp decrease in OI usually signals that traders are uncertain about the cryptocurrency and are not confident in taking positions on the asset’s price.
However, Solana recently has a knack for rebounding quickly from declines, which can currently threaten over $100 million in short positions.
Over the past 30 days, the price of Solana has been falling and recovering by 5% within 24 hours.
On April 19, for example, SOL saw a similar drop of 5% before quickly recovering to $157 within a few hours, just before the halving of Bitcoin on April 20th.
Similarly, if Solana’s price rises to $157, as it did on May 7, $125 million worth of short positions will be liquidated.
However, the recent drop in SOL can be attributed to the message on FTX the same day that it has enough funds to pay off the victims of the stock market crash after selling its assets – much of it Solana.
This coincides with a decline in overall crypto market sentiment, as the Fear and Greed Index score dropped 13 points in the last 24 hours, hitting a low of 9 points on May 54.
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