Solana price risks crashing below $100 despite SOL ETF inflows
Solana (SOL) has experienced a 38% price drop from its August high, now trading at $158. Despite this, SOL ETFs have seen significant inflows, totaling $342 million, with $600 million in total assets in newly approved funds. Technical analysis indicates bearish patterns, such as a death cross and inverse cup-and-handle, pointing to potential further declines below $100. On the positive side, Solana's ecosystem shows strength, with its decentralized exchange protocols surpassing competitors like BSC and Ethereum in transaction volumes. The broader cryptocurrency market, including Ethereum and XRP, is also underperforming.
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Solana Price Faces Bearish Trends
Solana (SOL) price is at risk of further declines in the coming weeks, as it has formed two highly bearish patterns on the daily chart. The token's price has crashed by 38% from its highest point in August, raising concerns among investors and traders. Technical indicators suggest the possibility of SOL dropping below the critical $100 threshold.
ETF Inflows Amid Price Decline
Despite the price decline, investors have continued pouring funds into recently launched SOL ETFs. According to data compiled by SoSoValue, spot SOL ETFs saw inflows of $6.78 million on Monday alone. Cumulatively, these funds have attracted $342 million, with the Bitwise SOL ETF holding the majority of assets at $329 million. Meanwhile, Grayscale’s GSOL recorded cumulative inflows of $12.8 million.
Expanding Interest in Solana ETFs
The total assets in Solana-related ETFs now stand at $600 million, a remarkable achievement for funds approved only two weeks ago. The growth is expected to continue as the SEC evaluates other Solana ETF proposals from companies like VanEck, 21Shares, Franklin Templeton, and Fidelity.
Solana’s Ecosystem Outperforms Competitors
Solana's ecosystem continues to show strength, particularly in Decentralized Exchange (DEX) protocols within its network. According to DeFi Llama, these platforms handled over $139 billion in trading volume over the last 30 days, surpassing Binance Smart Chain (BSC) at $102 billion and Ethereum at $88 billion. Leading contributors to this growth include DEX protocols like HumidiFi, Meteora, and Raydium.
Broader Crypto Market Impact
The decline in Solana’s price aligns with the performance of other major cryptocurrencies, including Ethereum, Avalanche, and XRP. Such retreats are common for crypto projects with strong fundamentals, particularly in a broader industry downturn.
Technical Analysis of Solana Price
The daily SOL price chart highlights a strong downtrend over the past few months. Notably, it has formed a death cross, where the 50-day and 200-day Weighted Moving Averages (WMAs) have crossed. SOL has moved below the Supertrend indicator, confirming bearish control. Additionally, an inverse cup-and-handle pattern with a depth of 38.2% has formed, suggesting a potential drop toward $96, which is near the year-to-date low. A further decline could be confirmed if SOL breaks below the key support level at $126, its lowest point in June.