The cryptocurrency market has indeed seen better days than last week, but the price of Solana has particularly struggled to cope with the broad downward pressure. This slow price could be linked to the major DeFi exploit that shook the ecosystem, causing a leak of over $270 million. According to the latest on-chain data, Solana price may come under even more pressure as exchange flows increase.
$110 million in SOL flows to centralized exchanges in 3 days
In an April 4 post on social media platform This on-chain observation has raised alarm over the potential price trajectory of SOL, especially given the already not-so-optimistic market sentiment.
The relevant indicator here is the Exchange Balance metric, which tracks the amount of a particular cryptocurrency available on centralized exchanges at any given time. This on-chain metric provides a certain level of insight into the current demand and supply dynamics in the crypto open market.
Therefore, an increase in the value of this measure suggests that more market participants are sending assets to exchanges, which could imply that supply could exceed available demand. This trend could be bearish for the value of an asset (Solana price, in this case), as it could be a sign of increasing selling pressure.
Source: @alicharts on X
According to Glassnode data highlighted by Martinez, 1.40 million Solana, worth approximately $110 million, was transferred to centralized exchanges in the last 72 hours. As we inferred earlier, coin movements of this magnitude are often red flags in the market, as they could be a potential source of bearish price pressure.
The reason behind this conclusion is that one of the main services offered by centralized exchanges is a platform for investors and traders to dispose of their digital assets. Therefore, this latest increase in FX inflow may be linked to an increase in selling pressure on Solana price.
Solana price at a glance
Interestingly, Solana price fell below the psychological support of $80 after hitting the local high around $85. At the time of writing, SOL price stands at around $80.8, reflecting no significant change over the past 24 hours. According to CoinGecko data, the altcoin’s value has fallen by more than 3% over the past seven days.
The price of Solana on the daily timeframe | Source: SOLUSDT chart on TradingView
Featured image from Shutterstock, chart from TradingView
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