Solana (SOL) dropped more than 7% on Monday, sliding from $88.05 on Sunday to an intraday low of $81.86. The token later tried to reclaim $90 during a broader market recovery, but the move stalled just below that level. On a monthly basis, SOL is down more than 30%, and it has fallen over 44% from this year’s highs.
The weakness is not limited to price action. DeFiLlama data show that weekly revenue on the Solana network has declined by more than 30% from the level seen in mid-January. Total value locked has also fallen, dropping from more than $9 billion on Jan. 17 to $6.64 billion at the time of writing. With both revenue and TVL moving lower, the market is reassessing whether the burst of growth tied to memecoin activity has started to fade.
Derivatives demand cools as traders reduce exposure
Positioning in the futures market has also weakened. CoinGlass data show SOL futures open interest has fallen by nearly 45%, dropping to $4.93 billion from its January peak of $8.88 billion. That pullback suggests traders have been unwinding positions while waiting for clearer signals from the geopolitical backdrop.
Broader macro pressure remains part of the setup. The report links the latest decline in crypto risk assets to the ongoing U.S.-Iran conflict. Over the weekend, Iran launched a retaliatory attack on U.S. ships stationed around the Strait of Hormuz, helping drive oil prices higher. Investors are now watching whether higher energy costs could feed into U.S. inflation and keep the Federal Reserve at restrictive levels for longer, or even force rate hikes. Assets such as Solana tend to respond better to easing expectations, and struggle when the Fed stays hawkish.
Daily chart shows bearish flag, with $70 back in view
On the technical side, SOL has formed a bearish flag on the daily chart after entering a downtrend in mid-January and then consolidating over the past few weeks. The pattern is commonly associated with downside continuation. Other indicators are leaning in the same direction: the Supertrend has turned red, while the Aroon lines are pointing lower, with Aroon Down at 50%, a sign that sellers still hold control.
If bearish momentum continues, SOL could revisit the Feb. 6 low near $70. If bulls manage to push the token back above the repeatedly tested $90 resistance, attention would shift to the $100 psychological level.