Solana price rallies 11% in a day as SEC Chair Gensler gives advice on FTX revival

• Solana price rallies by 11% in a day as SEC chair Gensler gives advice on how FTX could be revived.
• Solana price has surged 24% in the past week, bringing the price closer to the $50 mark, the highest level since May 2022.
• The FTX wallet has been emptying its holdings, selling between 250k to 750k SOL every day for the past two weeks.

Solana (SOL) price’s recent rally gained momentum on Thursday, propelled by a broad bullish sentiment in the crypto market but also by optimism about a possible revival of bankrupt exchange FTX, which was an early investor of the token.  

The US Securities and Exchange Commission (SEC) Chair Gary Gensler provided insight on FTX revival, stating that the responsible entity should “do it within the law”. FTX has been emptying its wallet by selling all the unlocked SOL for the past two weeks.

FTX could see a revival

The chair of the SEC, in an interview with CNBC on Wednesday, discussed the conditions under which the bankrupt exchange FTX could see a revival. Gensler, referring to reports of Tom Farley, former president of the New York Stock Exchange (NYSE), potentially buying what is left of the exchange, said that he would advise anyone who wants to be in this field to “Do it within the law.”

Further taking a dig at the founder and disgraced former CEO of FTX, Sam Bankman-Fried, Gensler noted,

“Build the trust of investors in what you’re doing and ensure that you’re doing the proper disclosures — and also that you’re not commingling all these functions, trading against your customers. Or using their crypto assets for your own purposes.”

Earlier last week, Bankman-Fried was found guilty on all counts of criminal charges placed against him by the US court, including fraud and money laundering. His sentencing remains due at the time of writing. 

On the other hand, FTX has been emptying the SOL it recently unlocked by selling between 250,000 to 750,000 SOL every day. At the time of writing, the wallet was emptied out, with the latest and final transaction of 21,759.99 SOL taking place on Thursday.

During bouts of such large selling, the price of the token tends to either decline or end up moving sideways. But in the case of Solana, the price kept increasing, and the market kept absorbing the liquidity.

Solana price reaches new highs

Solana price has not only marked a new 2023 high but also is presently on an 18-month high, trading at $47.65, a level last seen in May 2022. Rising by 11% in the last 24 hours, the rally added to the gains noted in the past week, bringing SOL up by 24%. 

The rise also helped the altcoin in breaching the 15-month-old barrier marked at $46. The cryptocurrency is trading above it, but a daily candlestick close followed by a test of the price as a support level would ensure the sustainability of the recent rise.

SOL/USD 1-day chart

However, if the rally overheats the market and investors begin booking profits, Solana price would become vulnerable to a drawdown. If the $46 support is lost, it would have an opportunity to bounce back from $36, but a close below it would invalidate the bullish thesis, potentially sending SOL to $31.