FTX Liquidations Update

The Situation

• SOL and other major FTX assets are significantly underperforming the market in fear of FTX liquidations potentially beginning Wednesday.

There have been large selloffs of major FTX and Alameda holdings, such as Solana and Polygon (MATIC), in anticipation of Wednesday's pretrial hearing, where liquidators could be permitted to start selling FTX and Alameda’s assets. SOL, APT, MATIC, and other major FTX holdings are down 20-30% over the last 30 days, while the broader market has seen an 11% pullback.

Solana has seen the bulk of the seller’s attention as it has led major assets in negative price action since mid-August.

More so than the spot markets, the derivative markets for Solana and other FTX assets have seen a sizable increase in open interest, particularly on the short side, which has driven funding rates to near lows on the year.