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Solana keeps losing important projects. How will it affect the token?

Igor Grigorchenko

News editor

Dec 2, 2022 at 12:17

Once again we try to assess the market situation around the popular blockchain Solana, which is keeping a delicate balance after the collapse of FTX. It became known about the closure of the important Solana-based Serum protocol, as well as the implementation of the Ethereum-support Phantom wallet for Solana. How will all this affect the price of the SOL token?

Is the Serum protocol dead?

The decentralized exchange protocol (DeFi/DEX) Serum on the Solana blockchain announced that it is no longer working. The collapse of FTX and related projects is to blame.

Serum’s problems began last week — the largest cryptocurrency exchange Binance announced the delisting of the SRM token along with all trading pairs.

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The Serum project was created by a consortium including FTX, Alameda Research and Solana Foundation. At the head of the Serum team is co-founder and former CEO Sam Bankman-Fried. The proprietary SRM protocol token provided owners with discounts on commissions when using the protocol, as well as management rights.

So what’s next for this project?

The Serum project itself has been stopped. What will happen to the native SRM project token is not clear. So far, it looks like there is a possibility of a Serum fork — OpenBook. The turnover of the new platform has already exceeded $1 million.

Phantom Wallet becomes multichain

Some other projects are also trying to distance themselves from Solana (or diversify their dependence on it).

An illustrative example is the Phantom wallet, which previously focused only on the Solana blockchain, but today the developers announced the beginning of the integration of Ethereum and Polygon networks.

Solana Price Situation

As we wrote before (here and here), the collapse of FTX hit the Solana project which was strongly affiliated with FTX. The situation with Serum and Phantom is a good example of how projects closely related to Solana either close down or try to distance themselves.

The price of SOL is slightly up but does not show any positive growth drivers. Solana’s slight current growth is due to the general growth of the crypto market (particularly the growth of Bitcoin).

What’s more, it became known that more than $643 million in Solana tokens are being controlled by liquidators as part of the bankruptcy process of Alameda Research (a subsidiary of FTX). Many token holders are starting to panic over this, expecting a giant dump. 

But article #11 of bankruptcy does not allow for an immediate sale of the assets. Their sale will not be possible until the entire bankruptcy proceeding is completed. This usually takes years. The official Twitter of Solana explains this in detail, trying to calm investors:

How can I make money on this?

There is still uncertainty about Solana. The main question is whether Solana will be able to demonstrate viability in the long run, having lost the care of the big boss in the form of FTX? Or will it gradually turn into a mediocre altcoin in the Ethereum Killer class, which already counts dozens?

The examples given today show that subsidiary projects based on Solana are either shutting down or distancing themselves. Solana itself remains silent about its long-term economic prospects, pretending that nothing is happening.

Because of this uncertainty, the market is in a very delicate equilibrium, waiting for further decisive events. Any investment in SOL against this background requires extreme caution and is risky.

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