FTX Unstakes $28 Million in SOL, Triggering Fears of Another Selloff

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Jimmy Aki

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Jimmy Aki

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Jimmy has nearly 10 years of experience as a journalist and writer in the blockchain industry. He has worked with well-known publications such as Bitcoin Magazine, CCN, Business2Community, and…

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Last updated:

October 15, 2024 10:52 EDT

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FTX and Alameda Research unstaked 178,631 Solana (SOL), valued at approximately $28 million, from a wallet tied to the collapsed crypto exchange on Tuesday, October 15.

This large-scale unstaking has raised concerns among market observers and Solana investors about a potential selloff that could affect SOL’s price.

The unstaked tokens are expected to be split across multiple wallets, with a substantial portion likely being transferred to major exchanges like Binance and Coinbase.

FTX’s Monthly SOL Unstaking Raises Concerns

Solscan tracked the latest FTX SOL transaction on early hours of Tuesday.

On-chain analyst @EmberCN noted that the unstaked SOL tokens, previously part of Solana’s proof-of-stake system, are likely headed to exchanges like Coinbase and Binance.

This pattern has been consistent over recent months, with similar transactions occurring between the 12th and 15th of each month, fueling speculation about further selloffs.

For instance, in September, FTX unstaked over 530,000 SOL, valued at around $71 million.

These assets were distributed across multiple wallets, with monthly SOL redemptions averaging 176,700 tokens, or about $23.5 million.

In one notable case, FTX redeemed 177,693 SOL in a single transaction, worth $23.75 million.

Despite these frequent transfers, FTX and Alameda Research still hold approximately 7.06 million SOL, valued at roughly $945.7 million as of mid-September.

The ongoing movement of these tokens raises concerns about potential effects on the Solana network and the wider cryptocurrency market.

FTX’s SOL Liquidation Strategy in Focus

This latest unstaking is part of FTX’s broader liquidation strategy of its extensive cryptocurrency holdings.

Since the exchange’s collapse, FTX has been gradually selling off assets to repay creditors.

Over the two months leading up to December 2023, FTX and Alameda Research transferred more than 13 million SOL tokens to various crypto exchanges.

Reports from April 2024 revealed that FTX sold over $1 billion worth of SOL tokens at a significant discount in an effort to raise funds. This process is part of FTX’s ongoing bankruptcy proceedings.

In September 2023, a court approved FTX’s plan to liquidate up to $100 million in crypto weekly, with the option to increase that amount to $200 million if needed.

On October 7, the United States Bankruptcy Court for the District of Delaware confirmed FTX’s reorganization plan, marking a key milestone for the collapsed exchange.

Under this plan, 98% of the company’s creditors will receive 119% of their allowed claims within 60 days.

FTX estimates the value of recovered assets will be between $14.7 billion and $16.5 billion, including those managed by Chapter 11 Debtors and liquidators from FTX Digital Markets (Bahamas) and FTX Australia.

FTX’s ongoing liquidation of assets, including Ethereum and Polygon, continues to recover funds for creditors, with billions more owed.