Solana Keeps on Crumbling Due to FTX Ties
Solana – a crypto that’s otherwise known as SOL to its personal holders – continues to shed value given it’s so tied to the fallen crypto exchange FTX and its disgraced head executive Sam Bankman-Fried.
Solana Isn’t Doing Too Well
FTX is currently in the process of filing bankruptcy. Sam Bankman-Fried is accused of lending out approximately $10 billion in user funds to his other company Alameda Research, which was supposed to be a separate and independent entity from FTX. By conjoining them through loan activity, he broke several agreement terms and is now awaiting trial for fraud and other charges.
He is in California at his parents’ home. The pair have signed a $250 million bond pledging their home and other personal assets as collateral should SBF choose to flee the country. Two other close friends have also pledged their assets to the bond requirement.
The Securities and Exchange Commission (SEC) – which is presently engaged in a civil suit against SBF and FTX – has stated:
Bankman-Fried was orchestrating a massive, years-long fraud, diverting billions of dollars of the trading platform’s customer funds for his own personal benefit and to help grow his crypto empire.
Solana has deep ties to the fallen exchange and has since crashed by more than 96 percent since reaching an all-time high during the month of November 2021. During that time, it was trading for just shy of $260 per unit. At the time of the FTX bankruptcy, the currency had fallen to less than ten dollars.
Solana’s ties to FTX are so deep that it’s often dubbed “Sam Coin” in honor of Sam Bankman-Fried (not such a big honor anymore). The asset has links to an on-chain crypto exchange known as Serum, which was also created by Bankman-Fried. Solana is issued by the Solana blockchain, which presently engages in decentralized finance (defi) protocols and offers monetary products such as loans and mortgages.
Not long ago, Solana was considered one of the most promising digital assets on the market, though things have certainly taken a nasty turn with the recent collapse of FTX. Still, there are some that claim it has a lot of potential, one of those being Vitalik Buterin. As the co-creator of Ethereum, Buterin recently stated on social media:
Some smart people tell me there is an earnest smart developer community in Solana, and now that the awful opportunistic money people have been washed out, the chain has a bright future. Hard for me to tell from [the] outside, but I hope the community gets its fair chance to thrive.
Could His Words Lend a Hand?
It’s unclear if this will help boost the currency’s prospects with traders.
Given Buterin’s present standing in the industry, it’s likely to do something, though things remain bearish at press time.
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