Solana (SOL), once a high flyer in the crypto market, now faces a precarious moment. After stalling at $146.9 this week, the token hovers near $131 down more than 50% from its 2024 peak.
The slide follows Donald Trump’s shock announcement of sweeping auto tariffs, sparking fears of economic turbulence. As markets pull back, analysts warn of deeper losses ahead. Here’s why Solana risks plummeting to $100.
Tariffs Ignite Market-Wide Panic
Trump’s proposed auto tariffs scared investors, triggering a Thursday sell-off that dragged Bitcoin, altcoins, and stocks lower. Experts caution additional “Liberation Day” tariffs could push the U.S. into recession.
Risk assets like Solana face pressure as traders flee volatility. With SOL already down 10% this month, the macroeconomic storm threatens to worsen its slide.
Ecosystem Strains
Solana’s ecosystem struggles deepen as meme coins, once a cornerstone, collapse. Insider exits and scams have left retail investors nursing losses, eroding trust. Decentralised exchange (DeX) volumes cratered to $8.7 billion weekly, far below Ethereum and BSC Chain.
Though tokens like Bonk and Popcat rebounded 10-20% recently, the recovery remains fragile. Without sustained momentum, Solana’s fee revenue and network demand could keep dwindling.
Technical Alarms Flash Bearish Signals
SOL’s charts paint a grim picture. A death cross emerged in February, a bearish signal where the 50-day average dipped below the 200-day. Now, a bearish flag pattern hints at further declines.
The token consolidates near $140 after a steep drop, testing a critical $120 support level. A breach here could spark a 30% plunge to $100. Resistance at $170 looms as a key hurdle for bulls.
Tokens Unlock, Whales Retreat
A flood of SOL tokens from the FTX bankruptcy estate (11.2 million unlocked in March) risks overwhelming demand. Furthermore, whales are reportedly offloading holdings, shifting funds to private wallets or exchanges. This dual pressure could accelerate selling, especially if retail investors panic. Historically, such supply surges have preceded price drops, making $100 a realistic target.
Competition Intensifies as Rivals Gain Ground
Ethereum’s scalability upgrades and new layer-1 blockchains threaten Solana’s edge. Once praised for speed and low fees, SOL now battles rivals luring developers and users. If network activity stagnates, investors may pivot to faster-growing ecosystems.
Also, the meme coin traders vital to Solana’s recent growth are exploring alternatives like Base and Avalanche, compounding SOL’s challenges.
FUD Spreads
High-profile rug pulls, including the LIBRA scam, have fuelled fear and doubt. Promoters allegedly abandoned projects post-hype, leaving buyers stranded. Such scandals tarnish Solana’s reputation, deterring new participants. Combined with tariff fears and technical warnings, negative sentiment could snowball, pushing SOL toward $100.
Will Solana Defy the Odds?
Despite the bearish outlook, hope remains. A surge past $170 resistance could invalidate the downturn, while meme coin revivals might reignite network activity. However, with macroeconomic winds fierce and technicals leaning south, Solana’s path of least resistance points downward. Traders should brace for volatility. The $100 question now hinges on whether critical supports hold or crack.
Market analysts urge caution, emphasising stop-loss orders and diversified portfolios amid the uncertainty.
