A Double-Edged Sword For Solana Investors Ben Lilly, a market analyst at Jarvis Labs, recently highlighted potential risks tied to the “Grayscale Effect.” In a social media post, he warned that the upcoming Grayscale SOL tokens unlock could create substantial selling pressure on the altcoin. Related Reading: Dogecoin Price Confirms Breakout: Analyst Sets New Price Targets Grayscale, a prominent digital asset management company, enforces a policy to protect assets for 12 months following acquisition.
Potential Price Drop Ahead For SOL’s Price Lilly points out that Grayscale is now executing a comparable strategy with Solana, and the upcoming unlocks could mirror the past volatility seen in the crypto market. The analyst notes that previous large purchases of SOL tokens saw private placements unlocked from late July 2024, during which the price dropped by 40% in just ten days. The concern is that the same trend may emerge with the January 2025 unlocks, potentially leading to a significant sell-off.
The analysis suggests that when investors who benefited from the premium in the past go to sell their holdings, they may flood the market, creating downward pressure on the SOL price. Related Reading: XRP Price Targets $13 After Completing Highest Candle Body Close In History – Details Lilly recommends that Solana holders consider selling in advance of the January 24 unlock date, as this could mark a critical turning point for the asset.
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