Solana (SOL) Faces Challenges Despite ETF Inflows as Traders Eye $110 Support Level

As 2025 comes to a close, Solana (SOL) is experiencing significant challenges. The cryptocurrency is caught in a struggle between a declining price trend and a rise in institutional interest.

Key Takeaways

Solana (SOL) has seen a substantial decline of 39% in Q4 2025, trading in the low-$120 range.
The number of active users has dropped dramatically, impacting fee revenue and overall demand for the token.
ETF-related products for Solana have attracted over $69 million in net inflows, indicating institutional confidence.
Market sentiment remains cautious, with traders particularly focused on the critical support level at $110.

Despite the recent inflows into exchange-traded funds (ETFs) linked to Solana, the asset is struggling to gather momentum. Currently, it is trading in the low-$120 range, with traders closely monitoring if essential support levels hold. The juxtaposition of declining network activity against the backdrop of consistent investment inflows has created uncertainty regarding Solana's future performance.

While the demand coming from ETFs points to potential long-term interest in Solana, short-term price movements appear vulnerable. As year-end liquidity tightens and the overall market sentiment remains cautious, SOL’s ability to maintain support levels could influence market dynamics heading into 2026.

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Solana's Network Slump and Negative Technical Indicators

One significant factor affecting SOL’s performance is the sharp decline in on-chain activity. The number of active users on the Solana network fell from approximately 30 million at the end of 2024 to below one million in Q4 2025. This reduction has led to decreased fee revenue and diminished demand for the crypto token.

This slowdown in activity coincides with a broader downturn in the crypto market, as the total market capitalization fell toward $2.9 trillion and nearly $1 billion was withdrawn from digital asset investment products in just one week.

From a technical perspective, indicators show a negative trend. SOL currently reflects a weak MACD and an RSI that is below neutral levels. Furthermore, repeated attempts to reclaim the $126-$130 zone have led to long liquidations. Analysts caution that if SOL falls below the $120 level, it could be at risk of dropping significantly toward $110, which has become a critical downside threshold.

Institutional Divergence Illustrated by ETF Inflows

Despite the lackluster performance in the market, Solana-related exchange-traded products have successfully attracted investment. Recent data indicates that these products have seen over $69 million in net inflows, setting them apart from Bitcoin and Ethereum, which have experienced capital outflows.

This divergence suggests that some institutional investors are choosing to accumulate Solana at lower prices, while short-term traders remain hesitant. Observers note that the difference in fund flows and spot prices indicates varying investment strategies. Institutions seem to focus on Solana’s potential as a key infrastructure for payments and tokenization, while the spot market grapples with technical resistances and declining retail participation.

Developments in Cross-Chain Capabilities and Future SOL Levels

Further adding to the discussion surrounding Solana are recent comments made by Charles Hoskinson and Anatoly Yakovenko. Both founders have indicated a willingness to explore a potential cross-chain bridge between Solana and Cardano. Although these discussions are still in the early stages and not formalized, they emphasize ongoing efforts to enhance liquidity and functionality across different blockchain ecosystems.

Currently, traders are concentrating on immediate price levels rather than long-term visions. Staying above $120 could enhance market sentiment, while a decisive drop below this support could draw attention to the $110 level. Until Solana can consistently reclaim resistance levels around $130, it is likely to continue facing downward price pressure, even with ongoing institutional interest.

Cover image from ChatGPT, SOLUSD chart from Tradingview.