What to know
- SOL fell 3.6% in 24 hours, extending its weekly loss to 5.8%.
- Fed’s rate pause and rising fears around Solana’s shrinking validator base are hurting investor confidence.
- Weak price action shows low buying interest, with the $120 level now a key support to watch.
Solana continued to slide this week, falling 3.62% in the last 24 hours and doing worse than the overall crypto market. This latest fall adds to a total weekly loss of 5.8%, showing that selling pressure on SOL is not slowing down. The drop is being driven by a mix of global economic worries, growing concerns about how the Solana network is run, and weak price movement on the charts.
Global Worries
One of the biggest reasons behind the fall is pressure coming from the global economy. On January 29, the US Federal Reserve decided to keep interest rates unchanged at around 3.6%. While this move was expected, it still disappointed markets that were hoping for signs of easier money and future rate cuts.
When interest rates stay high, people usually become more careful with their money. Instead of putting funds into risky assets like cryptocurrencies, they prefer safer options such as bonds or savings products. This shift in mood often hurts assets like Solana, which tend to rise when investors feel confident and fall when fear takes over. After the Fed’s decision, most of the crypto market turned red. Around 90 of the top 100 cryptocurrencies dropped in price, and SOL was pulled down along with the rest. The situation was made worse by political tension in the US, where there is growing pressure on the central bank to cut rates faster.
Solana’s Network Structure
At the same time, bad news from inside the Solana ecosystem has added to the pressure. Reports revealed that the number of validators supporting the Solana network has dropped sharply. In March 2023, Solana had about 2,560 validators. Today, that number is down to around 795, a fall of 68%.
Validators are important because they help run the network and keep it secure. When there are many independent validators, a blockchain is considered more balanced and harder to control. When the number drops, power becomes more concentrated in fewer hands, which raises fears about centralization.
This is exactly what investors are worried about now. Many smaller validators are leaving because running a validator has become too expensive. High operating costs and competition from large operators offering very low or zero fees have made it hard for small players to survive. As a result, control of the network is slowly shifting toward bigger players. This goes against one of the main ideas of blockchain and it has shaken confidence in Solana’s long-term structure.
Weak Price Movement
SOL’s price action itself is also not helping. The token is trading below key price levels that traders usually watch for strength. This shows that buyers are not very active right now, while sellers are still in control.
SOL is trading at $122.77, well below its 7-day Simple Moving Average ($125.4) and 30-day SMA ($133.55). The RSI-14 at 42.68 indicates bearish momentum without being oversold. The price is trapped in a multi-month consolidation range between approximately $117 and $148. Failure to hold above short-term moving averages suggests sellers are in control. The next critical support is the recent swing low near $117.58; a break below could trigger a deeper correction toward the $100 psychological level.
Final Thoughts
Solana’s current drop is not caused by one single issue. It is the result of global money pressure, growing worries about how the network is structured, and weak market confidence. For holders, this shows how sensitive SOL is to both world events and internal network problems. It also highlights the importance of watching not just price charts but also what is happening behind the scenes on the network itself.
Also Read: Why XRP Is Falling Even After Ripple’s Class Action Win
