The cryptocurrency market continues to grapple with volatility as Solana (SOL) experiences a significant downturn ahead of the upcoming FTX token unlock.
At the same time, stablecoin issuer Circle is strengthening its presence on the Solana blockchain, injecting billions of USDC as demand for regulated stablecoins rises.
Solana Drops Below $160 Amid Investor Uncertainty
Solana’s price has plummeted by over 7%, slipping below the $160 mark for the first time in 2025. On February 24, SOL fell to $158.46, marking its lowest point of the year and echoing levels not seen since October 2024. Despite a brief recovery attempt, Solana has remained stagnant around $159, struggling to regain higher ground.
Market data indicates that Solana’s value has decreased by nearly 13% over the past week and has suffered a more drastic 35% drop over the past month. The network’s market capitalization has shrunk to $78 billion, with a fully diluted valuation now at $95 billion.
Further exacerbating the downturn is a sharp decline in decentralized exchange (DEX) volume on the Solana network. Data from DeFi Llama shows that Solana’s DEX volume has fallen by 36.7% in the past week alone, with weekly volume now at $16.6 billion and daily volume at $1.5 billion.
FTX Token Unlock Raises Concerns
The primary factor contributing to Solana’s slump is the imminent unlocking of 11.2 million SOL tokens—valued at approximately $1.77 billion—linked to the now-defunct FTX exchange. Investors are wary that this influx of tokens into the market could drive down Solana’s price by increasing supply and heightening sell-off pressure.
While some investors view the decline as a potential buying opportunity, market data suggests that institutional players have been hedging against further losses. Recent derivatives activity indicates that large-scale investors are favoring put options over-the-counter rather than executing direct buy orders, a strategy often employed to mitigate market volatility.
Circle’s USDC Issuance on Solana Surges
Amid Solana’s market struggles, stablecoin giant Circle is reinforcing its presence on the blockchain. Recent data reveals that Circle has minted another 250 million USDC on Solana, bringing its total issuance on the network to 8 billion USDC for 2025.
According to on-chain analytics, Circle has added 1 billion USDC to Solana in just the past week, reflecting the blockchain’s increasing role in decentralized finance (DeFi) and trading activities. The surge in issuance has been further fueled by regulatory developments in the stablecoin sector, particularly in Europe.
Regulatory Tailwinds Boost USDC Adoption
Circle’s compliance with the European Union’s Markets in Crypto-Assets (MiCA) regulations has positioned USDC favorably against its competitor, Tether (USDT). Exchanges such as Crypto.com and Kraken have delisted USDT in the EU due to compliance concerns, leading to a shift in preference toward USDC.
Additionally, Circle has been expanding its operational scope beyond stablecoin issuance. The company recently acquired Hashnote, a tokenized real-world asset firm, and introduced Paymaster, a tool allowing users to cover gas fees using USDC on Arbitrum and Base. USDC has also been launched on Aptos, broadening its reach to 16 blockchain networks.
As a result of these strategic moves, USDC’s circulating supply has surged by 16% over the past month, outpacing USDT’s 2.5% growth. Circle’s market capitalization has now climbed to $57.19 billion, solidifying its standing in the global stablecoin market.
The Solana ecosystem faces a period of heightened uncertainty as the FTX token unlock event approaches, sparking concerns over price stability. Simultaneously, Circle’s aggressive USDC expansion on Solana reflects the network’s enduring significance within DeFi, even amid market turbulence.
While the impact of the FTX unlock remains to be seen, Solana’s long-term resilience may depend on investor sentiment and broader market trends. Meanwhile, Circle’s continued push into regulatory compliance and infrastructure expansion could further cement USDC’s role as a dominant stablecoin in the evolving crypto landscape.
