Solana at risk of a plunge: Why hasn't SOL's bottom yet revealed itself?

The real-world asset (RWA) tokenization ecosystem on Solana has just reached a historic milestone, with the total tokenized value surpassing $1.66 billion — a figure that demonstrates the rapid expansion of this on-chain asset sector.

The steady growth of RWA reflects a clear trend of capital shifting increasingly toward blockchain, while also indicating deeper participation of financial institutions in Solana’s payment infrastructure. Previously, Coin Photon also reported that this Layer 1 blockchain is currently among the leading platforms in revenue generated from dApps.

In the context of continued inflows into spot ETFs and consistently high network activity levels, Solana’s fundamental factors remain quite solid. Even in a “risk-off” market environment, the network still saw application revenue rates surge, from 262% up to 375%.

Daily SOL/USDT chart | Source: TradingView

However, these positive signals are still not enough to reverse Solana’s prolonged downtrend. The expansion of the RWA base and whale accumulation activities have yet to break the long-term downward channel — factors that continue to influence price action.

On the weekly chart, the risk of a sharp decline remains present. Notable imbalance zones could push the price back to the $140 level before a potential extended drop to $47.9 is tested as a support zone.

Source: Ali Charts on X

The current downtrend is considered too strong for a short-term reversal. Cryptocurrency analyst Ali Martinez recently shared a monthly chart of SOL on X, showing that the SuperTrend indicator has officially shifted to a “sell” signal.

The last time this signal appeared was in 2022 — after which SOL plummeted by 95%, highlighting the market’s ongoing risk.

Weak accumulation momentum unable to stop the bears

Source: Glassnode

The net position change indicator for holders turned positive in January, indicating that the long-term SOL holdings among holders have been increasing — a typical sign of accumulation.

However, over the past three weeks, the upward momentum of this indicator has noticeably stalled.

This weakening coincides with SOL losing the $100 level, reflecting a decline in long-term holder confidence compared to early January.

Source: Glassnode

Adjustment pressures may still persist, and holder caution is entirely understandable. The profit-bearing address ratio has fallen to its lowest level since November 2023, hovering around 20% in February.

During the previous down cycle, this figure even dropped more sharply, reaching a low of 1.37% on December 28, 2022.

While history does not necessarily repeat in the same way, long-term investors might still want to wait a few more months before considering deploying capital into SOL. The overall market sentiment remains bearish, and it’s too early to confirm that the bottom has truly been established.

SN_Nour