Experts warn of Grayscale impact on Solana 2025

Data researcher Ben Lilly believes the cryptocurrency market could face major volatility this year, especially with Solana (SOL). He predicts a “Grayscale Effec...

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Data researcher Ben Lilly believes the cryptocurrency market could face major volatility this year, especially with Solana (SOL). He predicts a “Grayscale Effect” that could put pressure on SOL prices.

The term refers to the potential impact from the unlocking of shares in the Grayscale Solana Trust, scheduled to occur twice in 2025 — between January 24 and February 2 and between July 24 and December 7. 8.

Impact of the Grayscale Effect on Solana

The “Grayscale Effect” is inspired by previous experiences with the Grayscale Bitcoin Trust (GBTC). When Grayscale unlocks shares, investors typically sell them for a spread — the difference between the net asset value (NAV) of the underlying asset (Bitcoin or Solana) and the share price. Historically, this has led to increased selling pressure, sharp price declines, and in some cases, market-wide volatility.

Lilly emphasize that a similar scenario happened in 2021 with GBTC. As the spread disappeared, the Bitcoin market peaked before a severe correction occurred, contributing to the fall of companies like 3AC, Celsius and Voyager.

Lilly argues that Grayscale Solana Trust (GSOL) can replicate this model. When SOL unlocks occur, investors can sell off shares, putting pressure on spreads and pushing prices lower. For example, a previous unlock from July 26 to 31, 2024 reported up to 40% reduction in SOL prices within ten days.

“This cycle, it looks like Grayscale is implementing the same model as the Solana version,” Lilly observe.

According to Lilly’s research, the upcoming unlock in January 2025 could have a similar effect. Investors who buy SOL shares at a premium can sell when the lock-up period ends, creating downward pressure on the price. Lilly warns that January 27, 2025 could mark “the beginning of the end” for GSOL spreads, with market corrections to follow.

“The next wave started on January 24 and lasted until February 2. When these buyers bought SOL, the spread was positive. When these investors come in to collect the difference, it may be the last time to collect,” he add.

Implications for SOL users and investors

Lilly emphasized that while the Grayscale Trust for Solana is relatively small compared to SOL’s total market capitalization, its influence should not be underestimated. Historical data shows that even small unlocks can cause major price disruptions.

The 2nd major unlock expected in July-August 2025 could also be another important period for SOL holders. In addition to leading to short-term local peaks, these unlocking events could also show a cycle top that parallels Bitcoin’s path in 2021.

Based on that, investors should be cautious around these important dates. If Solana experiences a price increase in early 2025, Lilly suggests a presale when the unlock begins. He warned that both January and July 2025 could be high-risk periods for SOL due to expected selling pressure.

SOL Price Performance — SOL price performance. Source: TinTucBitcoin

Data from TinTucBitcoin shows SOL is trading for $213.63 at the time of this writing, representing a modest gain of 2.56% since Friday’s open. Year-to-date, Solana’s price has increased nearly 12% since January 1, when it traded at $189.31.

Meanwhile, while the Grayscale Effect clearly creates risks for Solana, it also highlights broader concerns about the impact of institutional crypto products on market stability. Similar trust mechanisms and unlocking schedules have led to significant price swings across multiple asset classes.

Market participants, especially SOL holders, should prepare for potential volatility in early and mid-2025. Strategies such as hedging with derivatives or diversifying portfolios can help minimize the risks associated with these unlocks.