Peter Smith
Solana (SOL) and XRP face steep declines as scandals, regulatory setbacks, and market jitters shake investor confidence.
SOL Faces Sharp Decline Amid Memecoin Collapse and Political Controversy
Solana (SOL) has experienced a dramatic drop, losing over 40% in just a month. The downfall was largely triggered by a political scandal involving Argentine President Javier Milei, who publicly endorsed LIBRA, a Solana-based meme coin. This backing initially created excitement, but the project quickly became a disaster, with LIBRA’s market cap crashing 90% from $4.5 billion in a pump-and-dump scheme.
The collapse of LIBRA led to widespread sell-offs across the Solana network, as investor confidence crumbled. Compounding the issue, Milei now faces multiple lawsuits in Argentina, alleging financial misconduct related to the failed project.
Despite this turbulence, some analysts remain optimistic about SOL’s long-term potential. Investment firms like VanEck, Bitwise, and Pantera Capital still see the upside. VanEck projects that if institutional demand strengthens and the current crisis subsides, SOL could reach $520 by the end of 2025.
XRP Plunges as SEC Uncertainty and Trump’s Policies Weigh on Market
Unlike SOL’s scandal-driven decline, XRP’s slump is fueled by regulatory challenges and political uncertainty. The token has dropped 3.6% to $2.59, marking a 19% loss over the past month. Investors were hopeful that the SEC would approve an XRP Exchange-Traded Fund (ETF), which could unlock significant institutional inflows. However, the regulator has delayed its decision, keeping the market on edge.
Adding to XRP’s woes is the Trump administration's shifting stance on crypto. While Trump previously hinted at pro-crypto policies—including the idea of a Bitcoin reserve—his recent actions have been less encouraging. New tariffs on Canada, Mexico, and China have created a broader risk-off sentiment, which has impacted crypto markets, including XRP.
ETF Approvals: A Potential Lifeline for SOL and XRP?
Despite the recent sell-offs, there’s still a chance for a recovery, particularly if the long-awaited ETFs receive approval. The SEC is currently reviewing multiple XRP ETF applications from firms like Grayscale and Bitwise, and if they are greenlit, they could drive a wave of institutional investment.
Solana also has potential as an ETF, and discussions are underway about launching a regulated Solana fund. However, given the LIBRA controversy and ongoing lawsuits, regulators may be hesitant to approve anything related to SOL in the short term.
Market Outlook: Volatility Remains High for SOL and XRP
The near-term outlook for both SOL and XRP remains highly uncertain. Solana is still reeling from the LIBRA collapse, and if more memecoins within its ecosystem implode, investor confidence in its long-term viability may weaken further. Meanwhile, XRP’s fate hinges on regulatory clarity, particularly regarding ETF approvals and broader SEC decisions.
For now, crypto investors should brace for continued turbulence as political, regulatory, and macroeconomic factors continue to drive market sentiment.
Peter Smith
