Solana faces liquidity overhang as FTX Estate unstakes SOL

FTX Estate unstaked 1.1M SOL to fund creditor repayments

The FTX Trading Ltd. bankruptcy estate (FTX Estate) has unstaked about 1.1 million Solana (SOL) as creditor repayments move into a second year. The action forms part of an ongoing asset recovery and distribution process under court supervision, aimed at converting holdings into funds for approved claims. The figure reflects unstaking activity, not an immediate spot-market liquidation.

Unstaking is a blockchain step that releases previously delegated SOL so it can be transferred or sold later. By itself, it does not place sell orders or route tokens to exchanges, but it can increase flexibility and potential liquidity for future distributions.

The estate continues to sequence these actions alongside regulatory and court-approved procedures to align timing, custody, and any subsequent monetization. This pacing matters for both recoveries and market stability and helps separate operational steps from market execution.

FTX Estate unstaking SOL isn’t immediate selling; liquidity implications

Unstaking should not be conflated with selling, and any market impact depends on how quickly tokens move from wallets to venues and the size of each tranche. Analysts have cautioned that concentrated liquidations can pressure prices if executed too quickly, especially when markets anticipate overhangs, as reported by Cointelegraph.

Since November 2023, the estate and related entities have cumulatively unlocked and redeemed roughly 8.98 million SOL, about $1.2 billion at an average SOL price of $134, with a recent batch of approximately 192,000 SOL noted as part of ongoing redemptions, as reported by The Currency Analytics.

Despite these withdrawals, an estimated 4.18 million SOL remains in staking pools under vesting schedules, limiting what is immediately tradable and pacing potential supply into the market, as reported by Crypto.news.

Taken together, these mechanics indicate any liquidity effects are likely to play out in stages rather than all at once, though exact batch sizes and timing remain subject to operational decisions and court approvals.

Creditor repayment plan and locked SOL auctions explained

The confirmed bankruptcy framework values creditor claims using petition-date pricing, a practice often called dollarization, which fixes claim values to asset prices at the time of the November 2022 filing; the court approved the estate’s plan on that basis, as reported by CoinDesk. This approach is designed to ensure consistent, pro rata distributions and to reduce disputes tied to post-petition volatility, even as some creditors argued for in-kind crypto distributions to capture later upside.

To monetize illiquid positions, the estate has also organized auctions of locked SOL, tokens subject to vesting or transfer restrictions, typically offered at discounts that reflect time-to-liquidity and risk, as reported by CryptoNews.com. Creditor advocates such as Sunil Kavuri have criticized these structures for favoring institutional buyers through discounts and minimums, and they have called for greater transparency around allocations and pricing.

From the ecosystem side, Solana co-founder Anatoly Yakovenko has argued that large FTX-held SOL should be redistributed directly to customers affected by the collapse, a view that reflects ongoing community debate about how best to unwind concentrated holdings, as reported by Tekedia.

The legal footing for this approach was reinforced by the plan’s approval, which set the guardrails for valuation and distributions. “Delaware judge approves FTX Estate’s bankruptcy plan,” said CoinDesk, summarizing the outcome.