Solana Down 93% From ATH as Concerns Grow Over Alameda Exposure

Solana Down 93% From ATH as Concerns Grow Over Alameda Exposure

Regarding this, the value of Solana (SOL) has decreased by more than 93% since its peak in November 2021. This token's precipitous fall came about due to its ties to Alameda Research. Other sources also suggest that Binance's most recent rescue effort to take over FTX following its liquidity crisis was part of the reason this happened.

After a shocking revelation by Binance that it was purchasing competitor FTX in a rescue move that deepened the current crypto winter, Solana (SOL) plunged over 40% to $18.2 on Wednesday. After the decline, SOL lost almost 90% of its value from its peak in 2021, at the height of the cryptocurrency craze.

Overexposure to Alameda Research, a cryptocurrency trading company founded by Sam Bankman-Fried (SBF), also the CEO of the defunct FTX, is another aspect that has contributed to Solana's most precipitous downturn. There were rumours that Alameda was looking to sell its SOL interests to obtain new liquidity.

Nevertheless, following the surprising news that Binance, the biggest cryptocurrency exchange in the world, had approved a non-binding letter of intent to purchase FTX despite a liquidity shortage at the crypto exchange in the Bahamas, the token's losses grew. After FTX suffered $6 billion in withdrawals within only three days, the takeover signals a bailout.

Changpeng Zhao, CEO of Binance, put enormous strain on FTX before the takeover announcement through a tweet he made on Sunday. He said Binance wants to sell its holdings of FTX's native token, FTT, because of recent developments. Most people believe Zhao was referencing claims that the FTT token bloated Alameda's balance sheet, even though he did not clarify which discoveries he was talking about.

Do you see Solana coming back from this sudden fall soon? Kindly share your thoughts with us in the comments section.