Following the FTX fiasco, the Solana ecosystem plummeted almost 98% to $210 million, from its peak of $10.17 billion in November 2021, causing uncertainty in the community.Â
The FTX crash pushed Solana Foundation to reveal the full extent of its financial ties to FTX and Alameda Research as it has approximately 3.43 million FTT tokens and 134.54 million SRM tokens stranded on FTX.
Solana projects were always supported by FTX’s Sam Bankman-FTX Fried and Alameda Research, which in turn affected them adversely in the current market conditions.
According to last month’s report, Alameda Research liquidators hold Solana Tokens worth $643 million. These are locked SOL tokens, thus cannot be sold and are not in circulation. Since FTX and Alameda filed for Chapter 11 bankruptcy, these tokens now belong to liquidators.
Even if it is unlocked, the SOL tokens may not be in circulation for years because they are currently involved in legal disputes. Until the FTX bankruptcy proceedings are over, it can be locked for more than ten years.
Crypto investment firm Multicoin Capital frequently collaborated on projects with FTX and Alameda. With FTX, Multicoin backed an interoperability network, a capital formation startup, etc.
With Alameda, Multicoin assisted Solanas Eden Network, a stablecoin protocol, the NFT platform Metaplex and it was also an investor and user of FTX.
Two of the most important NFT projects in the Solana ecosystem, DeGods and y00ts, both also announced that they are moving to Polygon and Ethereum, respectively. There are speculations that both projects requested funding from the Solana foundation in order to continue operating on the blockchain. Â
Since hitting an all-time high of $259.90 in November 2021, the Solana token price has dropped drastically. The SOL price fluctuated in the $29 area between May and November 2022. SOL is now trading for $10.06 at the time of writing.
