Solana (SOL), once touted as a potential Ethereum killer, is facing a significant headwind from institutional investors. Despite the recent approval of a second spot SOL ETF in Brazil, which was expected to boost the cryptocurrency’s price, institutions have been steadily pulling their funds out of SOL.
According to CoinShares, Solana saw outflows of $38.9 million in the week ending August 17. This marked a significant decline compared to other cryptocurrencies, including Bitcoin and Ethereum, which experienced more modest outflows. The net outflow for Solana year-to-date now stands at $31 million, underscoring the growing pessimism among institutional investors.
This institutional exodus is particularly concerning given the recent bullish sentiment surrounding Solana. The approval of the Brazilian ETF was seen as a positive development, signaling growing institutional interest and potentially driving up the price. However, the reality has been quite different.
The bearish sentiment is also reflected in Solana’s technical analysis. The Relative Strength Index (RSI) has fallen below the neutral line, suggesting that the buying momentum is waning. This indicates that the recent price recovery may be short-lived.
Solana’s future price outlook remains uncertain. While the cryptocurrency has managed to hold above a key support level of $137, a continued decline cannot be ruled out. If the support level is breached, Solana could face further downside pressure, potentially falling to $126.
However, there is still hope for a recovery. If Solana can regain momentum and reclaim $156 as a support level, it could signal a potential bullish reversal. In this scenario, the price could rise to $169, offering some relief to investors who have been weathering the storm.
Overall, Solana’s institutional exodus is a significant blow to the bullish narrative. While the recent ETF approval was a positive development, it has failed to attract sustained institutional interest. The cryptocurrency’s future price trajectory will depend on its ability to regain investor confidence and overcome the current bearish sentiment.
