The near collapse of the fourth largest cryptocurrency exchange FTX could spell the end of Solana NFTs. For those who don’t know, there was a destructive situation between FTX and its competitor Binance. Unfortunately, it caused SOL to plummet by more than 40% in the last 24 hours and 50% in the last 7 days! As a result, Sol’s price is $13.80, 94% below its all-time high of $351.96.

How will this affect Solana NFTs and why? Let’s take a look.

SOL price plummets

The situation between the two exchanges is what caused SOL to fall sharply, but where did it all start? First, it all started when Binance CEO Changpeng Zhao tweeted that FTX was spreading rumors behind closed doors to the United States, and then he tweeted that he would sell $2 billion of FTT tokens (FTX native token). It is worth noting that unlike Bitcoin, FTT is liquid, which led to the CEO being able to own such a large amount of tokens. That said, as soon as he sold, it triggered a major sell-off that made FTT plummet by 63%. Sadly, this affected the entire crypto market. FTX's Samuel-Bankman-Fried was seen as someone who could assist in the regulatory approval of cryptocurrencies.

The connection between Solana and FTX

SBF is a major investor in Solana and even referred to the cryptocurrency as the "ethereal killer". In addition to the overall impact of FTX's bankruptcy on the market, the connection between the exchange and Solana must also be mentioned. According to Coindesk, Bankman-Fried's trading company Alameda Research has $1.1 billion worth of SOL on its balance sheet. This is more than 10% of the solana supply. Obviously, investors are worried that Solana will lose all the investments made by FTX.

What does this mean for Solana NFTs? Will deposits stop?

With all the pressure Solana is facing, it’s hard to say who will stay in the ecosystem. Will everyone leave, or will the true builders stay and act like nothing happened? In short, we don’t know what will happen to Solana NFTs in the coming days. This could be one of the worst crypto disasters we’ve ever seen. Plus, there are some big players in the ecosystem, like Magic Eden, who are trying to keep members on their toes.

Nonetheless, community members are doing their best to stay afloat amidst this crazy price action. Many of them have something interesting to say, including the @SolanaMBS NFT project.

Furthermore, it is an unfortunate fact that the Solana chain is well known for its network outages. Since January 2022, there have been 13 outages, with 1 outage lasting 16 hours and 24 minutes. Even during the FTX debacle, the chain experienced performance issues. Specifically, Defi protocol Solend indicated that the transaction failure occurred due to network issues. What will happen next in this volatile market? We will have to wait and see.  👀