The price of Solana (SUN) has plummeted more than 6% in the past 24 hours, amid fears that bankrupt crypto exchange FTX may soon liquidate its significant portions of the token and other Solana-affiliated crypto assets.
According to a combination of data from Solscan, which has aggregated the value of all three publicly available FTX cold storage wallets, the FTX estate holds a total of $1.5 billion in crypto assets on the Solana network.
Of that important figure, Solana tokens represent only $128 million.
The rest of the amount is made up of numerous Solana-based altcoins, such as Wrapped Bitcoin (WBTC), Maps token (MAPS), Serum (SRM), and a number of other tokens colloquially referred to as "Sam coins", a joke on Sam Bankman-Fried, former CEO of FTX.
Still, the idea that liquidators could soon release $128 million in SOL and hundreds of millions in other SOL-affiliated tokens to the market has not inspired much market confidence.
Several users took to X (formerly known as Twitter) to voice their concerns about the impending liquidation. "FTX is about to offload SOL worth $680 million ๐" wrote an user. "SOL will sell off strongly after FTX sells its stock and will soon reach $14." saying other.
Others, however, have urged calm, since the bankruptcy plan actually restricts how much can be sold at once.
According to FTX bankruptcy filings, the proposed plan for liquidation of FTX assets imposes a series of conditions on the sale of tokens.
On August 24, FTX proposed naming Mike Novogratz's Galaxy Digital Capital Management as the investment manager that would oversee sales of its recovered cryptocurrency holdings.
In this plan, the FTX estate would only be allowed to sell a maximum of $100 million worth of its tokens each week; however, that limit could be increased to $200 million per individual token.
These limits were introduced in an attempt to minimize the impact of token sales on the broader market while allowing FTX to compensate creditors.
The collapse of FTX, and consequently the biggest black swan Solana has ever endured, put SOL at $8
And are we worried about the ~$600 million that will be sold over the course of the next 5 years?
Some major L1s have higher inflation than this and no one cares.
- Gumshoe (@0xGumshoe) September 10, 2023
Notably, the plan has not yet been approved by the courts; However, the plan and a host of other matters related to the FTX token sales are expected to be filed in Delaware Bankruptcy Court on September 13.
Related: FTX Wallet Transfers $10 Million in Crypto, Raising Fears of Future Token Dumps
In an April 12 hearing, FTX revealed which had recovered approximately 7.3 billion dollars in liquid assets, of which $4.8 billion be composed of assets recovered as of November 2022.
However, in general, according According to documents raised at the hearing, FTX had a total of $4.3 billion in crypto assets available for recovery to interested parties at market prices as of April 12.
At the time of this publication, Solana is changing hands for $18.38 each, down almost 11% on the week.
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