Analysts say SOL price action could mirror ETH’s lagging performance after the Ethereum spot ETFs launched.
Traders and analysts were highly bullish on SOL (SOL) throughout September, citing the US Securities and Exchange Commission’s Oct. 10 deadline for a portion of the spot ETF approvals and the stellar performance of the BTC and ETH ETFs as the thesis for positioning ahead of the event.
At the time, data showed various investor cohorts piling into SOL futures and spot holdings, but the US government shutdown threw the deadline into limbo, and the sharp total crypto market liquidation event on Oct. 10 sent the altcoin’s price as low as $147 at some crypto exchanges.
Fast forward to the present, and the market now has two new SOL ETFs trading this week. Grayscale Investments launched their staking-enabled Solana spot ETF (GSOL) on Wednesday, while on Tuesday, the Bitwise Solana Staking ETF (BSOL) went live. Cointelegraph reported that BSOL launched with $222 million in assets and ended its second day of trading with $72 million in trading volume.
Prior to the US government shutdown and the Oct. 10 sell-off, analysts predicted that a Solana ETF approval and successful launch would kickstart a SOL price rally into the $300 to $600 range, yet the altcoin currently trades under $200.
When asked about the situation and whether or not the SOL trade has become a sell-the-news-style outcome, Hyblock analysts said:
“BTC’s ETF launch and BTC price also had a similar relationship on launch. BTC price trended flat and down (around -5%) despite growing inflows. Eventually, the floodgates opened and inflows really spiked, which marked the bottom on BTC price. The SOL ETF may be going through a similar cycle as the initial excitement fades away.”
The analysts added that this week’s “FOMC timing doesn’t help as many participants (especially institutions who would buy via ETF) are likely de-risking ahead of the meeting. We don’t view it as a red flag; it’s expected behavior for high-profile events such as these.”
Related: 21Shares files HYPE ETF, Bitwise Solana ETF sees ‘huge number’ on day 2
Current data shows sellers dominating SOL’s price action, with the orderbook highlighting support at $188 to $185 and resistance at $204 and $207.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
