Solana’s price has seen a sharp decline over the past month in line with the broader market correction, intensifying concerns as rumors of a possible investigation into the popular blockchain platform recently surfaced.
Regulatory storm brewing?
On a social media posts on X (formerly Twitter), Crypto market expert Bitlord, who has a sizable following of over 300,000 people, suggested an alleged investigation into Solana. The post said:
We are hearing rumors that SOL is under investigation and a big case is about to become public. This has been brewing for weeks and it couldn’t happen at a worse time.
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While specific details about the jurisdiction or agency conducting the alleged Solana investigation have not been released, the United States has been at the forefront of a continued repression in the cryptocurrency industry since the collapse of crypto exchange FTX in late 2021.
The fallout from the FTX incident resulted in a series of lawsuits and accusations against several industry executives. Notable figures like former Binance CEO Changpeng Zhao (CZ) and Coinbase have faced legal scrutiny.
A comparable scenario can be drawn with XRP and Ripple, as they are involved in a complex legal confrontation over the sale of digital assets.
For Crypto Bitlord, which has contributed to projects such as Shiba Inu (SHIB), Floki Inu (FLOKI) and Pepê Currency (PEPE), the potential impact on Solana’s price is significant. In response to skeptical comments, Bitlord warned: “Don’t cry when SOL is at $3 again.”
However, until new news about the alleged investigation emerges, these statements remain speculative. Solana’s founders have not made official statements regarding these rumors.
Solana Price Analysis
The Solana price has suffered significant losses over multiple time periods, with drops of over 9%, 18%, and 22% in the last seven, fourteen, and thirty days, respectively. However, despite the downward trend, SOL’s trading volume has remained robust, surpassing $2.8 billion in the last 24 hours alone, according to CoinGecko. data.
Digital asset investment company CoinShares reported Notable inflows into several altcoins following recent price weakness, with Solana seeing inflows of over $2.7 million. This suggests that despite falling prices, some investors see potential value in SOL and are strategically entering the market.
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However, Solana price faces a critical test as it approaches crucial support levels. Currently, SOL is trading just above the four-month support level of $127, which marked the uptrend when Solana price reached a yearly peak of $210 in mid-March.
If selling pressure If it intensifies and this support is broken, SOL could fall to $117, representing the token’s next significant level of medium-term support.
Other walls of support for SOL in the event of a sustained bearish move are at the $109 and $102 levels. These levels should be watched closely by bullish investors looking to prevent Solana from falling below $100.
Featured image of DALL-E, chart from TradingView.com