Solana Under Pressure as ETF Delays and Weak On-Chain Demand Cloud Future Prospects

Solana Price Retreats As Regulatory Uncertainty And Weakening Activity Mount

October 24, 2025

The Cryptocurrency Solana (Sol) is currently valued around $185, experiencing a 3.5% decrease in the last 24 hours. This dip follows a loss of upward momentum after reaching $190, a situation reflecting broader caution within the digital asset market as investors grapple with macroeconomic concerns and postponed regulatory decisions.

Currently, the token is trading just below the 200-day Exponential Moving Average (EMA) at $186, indicating a shift toward a more fragile short-term outlook and a cautiously bearish technical analysis.

Decline in Network Engagement

Data reveals a weakening in network activity, potentially challenging Solana’s ability to maintain the rally observed in the previous quarter.Recent figures from DefiLlama demonstrate an average of 15 million active addresses weekly, a important drop of nearly 55% from the 33.6 million recorded in May. This week alone, only 4.74 million addresses have engaged with the blockchain.

Reduced user participation translates to lower transaction volumes, diminished on-chain liquidity, and decreased network revenue-factors that collectively constrain demand for Sol and limit capital inflows into emerging decentralized projects.

Derivatives Market Contraction

The downturn in activity has impacted Solana’s derivatives market as well. Futures open interest has significantly decreased to $8.64 billion, a 42% contraction from nearly $15 billion earlier in the month. this signals a clear decline in speculative interest, as traders reduce their leveraged holdings.

Weighted funding rates have edged slightly into negative territory at -0.0001%, suggesting a growing bias toward short positions. While this is well below the -0.375% panic levels seen during a liquidation event in October, the trend points to persistent discretion rather than excited buying activity.

Technical Analysis points to Downside Risk

From a technical viewpoint, Solana is under pressure as bears maintain control below the 200-day EMA. The Moving Average Convergence Divergence (MACD) indicator has once again turned bearish, reinforcing expectations for further declines. A daily close below $185 could confirm a support breach, possibly leading to a 6% fall to $174, the next key demand level. RSI readings near 46 also suggest potential for continued weakness before the market becomes oversold.

Did You Know? the 200-day EMA is a widely-followed technical indicator used by traders to gauge long-term trends in an asset’s price.

Upside Potential Remains

The overall outlook isn’t entirely pessimistic. A swift move above the 200-day EMA could trigger short covering, particularly if broader cryptocurrency sentiment improves. Initial resistance is anticipated around $190, followed by the psychological $200 mark, where a sustained breakout could re-establish bullish momentum. However,this scenario requires increased trading volume and stabilization in network engagement.

Institutional Interest Provides Support

Despite recent headwinds,institutional interest remains a quiet positive influence. According to CoinShares, Solana-linked exchange-traded product flows recorded $156 million in weekly inflows, bringing year-to-date totals to approximately $2.8 billion. This consistent accumulation is counterbalanced by $946 million in outflows from comparable products during the same timeframe, implying that certain investors are positioning themselves ahead of potential ETF approvals later this year.

Metric	Current Value	Previous Value	Change
SOL Price	$185	$194	-3.5%
Active addresses (Weekly)	15 Million	33.6 Million (May Peak)	-55%
Futures Open Interest	$8.64 Billion	$15 Billion	-42%

Regulatory Delays Introduce Volatility

The U.S. Securities and Exchange Commission (SEC) has deferred its decision on several cryptocurrency-related ETFs, including Bitwise’s proposed spot Solana fund, extending the review period. This delay has dampened short-term optimism, but approval could unlock billions in institutional capital, potentially fueling a strong recovery similar to the surge seen with Bitcoin ETFs earlier in the year.

Pro Tip: Always stay informed about regulatory developments, as they can significantly impact cryptocurrency prices.

Solana’s Ecosystem Continues Innovation

Despite recent weakness, Solana’s network remains fundamentally active compared to many of its layer-1 competitors. Transaction volume, Decentralized Finance (DeFi) participation, and Non-Fungible Token (NFT) activity are among the highest in the industry.The recent proclamation by Solana co-founder Anatoly Yakovenko promoting Percolator, a decentralized futures exchange, demonstrates ongoing innovation within its ecosystem. Increased liquidity from such initiatives may eventually offset the current slowdown in user activity.

Understanding Solana’s Layer-1 Technology

Solana utilizes a unique Proof-of-History (PoH) consensus mechanism combined with Proof-of-Stake (PoS) to achieve high transaction speeds and low fees. This makes it a compelling platform for decentralized applications (dApps) and DeFi projects. However, it’s crucial to understand that Layer-1 blockchains are constantly evolving, and network congestion can still occur during periods of high demand. Learn more about Solana’s technology here.

Frequently Asked Questions About Solana (SOL)

• What is Solana? Solana is a highly functional, open-source blockchain that uses a hybrid consensus mechanism to achieve scalable, secure, and censorship-resistant transactions.
• What factors are impacting the price of Solana? Regulatory delays, declining network activity, and broader macroeconomic conditions are currently influencing Solana’s price.
• What is the 200-day EMA and why is it important? The 200-day Exponential Moving Average is a key technical indicator used to identify long-term trends. A price below this level frequently enough suggests a bearish trend.
• What is Institutional interest in Solana? Exchange-traded product (ETP) flows and ETF applications represent increasing institutional interest.
• Is Solana a good investment? Investing in Solana, like any cryptocurrency, carries risks. Thorough research and understanding your risk tolerance are essential.

Will Solana be able to defend its current price range, or are further declines certain? share your thoughts in the comments below!

How do SEC concerns regarding Solana’s decentralization impact teh potential approval of a spot Solana ETF?

the ETF Factor: A Critical Roadblock for Solana

The anticipated approval of a spot Solana ETF has been a meaningful driver of bullish sentiment for much of 2024 and early 2025. However,repeated delays by the SEC are now casting a long shadow over the SOL price and overall market confidence.Originally expected in early 2025, the decision has been pushed back, with no firm date in sight. This uncertainty is impacting institutional investment,a key component for sustained growth.

* SEC Concerns: The primary reason cited for the delays revolves around regulatory clarity regarding Solana’s network decentralization and potential for market manipulation.

* Impact on Price: Each delay declaration has correlated with a noticeable dip in SOL’s price, demonstrating the market’s sensitivity to ETF news.

* Investor Sentiment: The prolonged wait is breeding frustration among investors who had positioned themselves for the expected ETF-driven rally.

Declining On-Chain Metrics: A Worrying Trend

Beyond the ETF situation, concerning trends are emerging within Solana’s on-chain data. While Solana once boasted impressive network activity, recent metrics paint a less optimistic picture. this weakening demand is a critical issue that needs addressing.

* Active Addresses: The number of active Solana addresses has been steadily declining as Q3 2024, indicating reduced user engagement.

* Transaction Volume: Daily transaction volume has also experienced a downturn, suggesting less activity within the Solana ecosystem.

* Network Revenue: Solana’s network revenue,a key indicator of developer and validator health,has seen a significant decrease,impacting profitability.

* DeFi Activity Slowdown: Total Value Locked (TVL) in Solana-based DeFi protocols has stagnated, failing to capitalize on the broader DeFi market recovery.

Examining the competition: Ethereum and Option Layer-1s

Solana isn’t operating in a vacuum. The competitive landscape within the Layer-1 blockchain space is fierce. Ethereum, despite its higher gas fees, continues to dominate in terms of developer activity and TVL. Furthermore, alternative Layer-1 blockchains like Avalanche and BNB Chain are actively vying for market share.

* Ethereum’s Resilience: Ethereum’s ongoing upgrades (like Dencun) and established ecosystem continue to attract developers and users.

* Avalanche’s Subnets: Avalanche’s customizable subnets offer a compelling alternative for projects seeking tailored blockchain solutions.

* BNB Chain’s Ecosystem Growth: BNB Chain benefits from the backing of Binance and a rapidly expanding ecosystem of dApps.

* Solana’s Differentiation: Solana needs to clearly articulate its unique value proposition – speed and low cost – and demonstrate its ability to maintain network stability.

Network Congestion and Stability concerns

Solana has historically struggled with network congestion and occasional outages. While improvements have been made, these issues continue to surface, eroding user trust and hindering adoption. The recent outages in early 2025, though brief, served as a stark reminder of these vulnerabilities.

* Past Outages: Recurring network outages have damaged Solana’s reputation for reliability.

* Congestion During Peak Times: Periods of high network activity frequently enough lead to increased transaction fees and slower confirmation times.

* Ongoing Development Efforts: The Solana Foundation is actively working on solutions to improve network stability and scalability, including Firedancer and other optimizations.

* Validator Performance: monitoring validator performance and incentivizing robust infrastructure are crucial for maintaining network health.

The Role of Memecoins and NFT Market Fluctuations

Solana experienced a surge in popularity fueled by the memecoin craze and a thriving NFT market in 2023 and early 2024.However, the memecoin hype has cooled, and the NFT market has experienced a significant correction. This shift has impacted network activity and revenue.

* Memecoin Volatility: The highly speculative nature of memecoins makes them susceptible to rapid price swings and market manipulation.

* NFT Market Correction: The decline in NFT sales volume has reduced demand for Solana’s blockspace.

* Sustainable Growth: Solana needs to attract projects beyond memecoins and NFTs to achieve sustainable growth.

* Real-World Use Cases: Focusing on developing real-world applications, such as DeFi, payments, and supply chain management, is essential.

Potential Catalysts for a Solana rebound

Despite the current challenges,several factors could potentially trigger a Solana rebound.

* ETF Approval: The eventual approval of a spot Solana ETF would likely inject significant capital into the ecosystem.

* Network Upgrades: Successful implementation of network upgrades, such as Firedancer, could improve scalability and stability.

* Institutional Adoption: Increased adoption by institutional investors could provide a much-needed boost to SOL’s price.

* Developer Activity: A resurgence in developer activity and the launch of innovative dApps could revitalize the Solana ecosystem.

* Strategic Partnerships: Forming strategic partnerships with established companies could expand Solana’s reach and user base.

Understanding Solana’s Tokenomics

Solana’s native token, SOL, plays a crucial role in the network’s operation. It’s used for transaction fees,