NEW YORK (Reuters) – The value of Solana, a cryptocurrency token that had been lauded by FTX founder Sam Bankman-Fried, fell 10.36% on Wednesday, and is down 94.2% to this point in 2022.
The collapse of FTX has rippled throughout the trade, hobbling liquidity at companies with publicity to what was as soon as one of many world’s greatest crypto exchanges.
Solana, or SOL, is the token behind the upstart Solana blockchain, which helps good contracts, together with non-fungible tokens, and has emerged as a rival to the ethereum blockchain.
Bankman-Fried, who is anticipated to enter a plea subsequent week to legal prices he defrauded buyers and looted billions of {dollars} in buyer funds at FTX, continuously praised Solana. FTX and Alameda, Bankman-Fried’s buying and selling agency, held Solana tokens on their stability sheets.
Whereas Solana has no direct relation to FTX, and had restricted publicity to the failed alternate, its affiliation with Bankman-Fried has been a drag.
“The final downside with crypto is that its lack of intrinsic worth implies that values are based mostly on confidence and perceived utility. If these undergo in relation to a particular token, then it suffers,” mentioned Steve Sosnick, chief strategist at Interactive Brokers.
A consultant for Solana was not instantly obtainable for remark.
SOL has dropped 51.14% for the reason that furor round FTX started unfolding on Nov. 2. In the identical interval, ether has fallen about 21.3% and bitcoin 17.6%.
The value of Serum, or SRM, the token for the decentralized alternate of the identical title created by Bankman-Fried on the Solana blockchain, is down 80.5% since Nov. 2, buying and selling at simply over 14 cents, in line with coinmarketcap.com.
The overall market capitalization of the cryptocurrency market now stands at $798.4 billion, in line with the web site, down from a peak of over $3 trillion in Nov. 2021.
(Reporting by John McCrank; Enhancing by David Gregorio)
