Solana price decline causes spike in long liquidations

Over the past 24 hours, SOL price volatility has led to a substantial liquidation of long positions on centralized exchanges. The volatility resulted in the liquidations of over $7 million in SOL -6.34% positions, with the vast majority (over $6 million) being longs.

The overall crypto market saw over $88 million of liquidated long positions in the last 24 hours, contributing to a total of $126 million in liquidations across various centralized exchanges, according to CoinGlass data.

In derivatives markets, liquidations take place when a trader’s position is forcibly closed due to insufficient funds to cover losses. This situation arises when market movements are unfavorable to the trader’s position, resulting in the depletion of their initial margin or collateral.

Solana transaction volume decreases

The transaction volume of Solana-based tokens has also dropped after reaching a 12-month high in the first week of January, according to data from The Block’s Data Dashboard. The value of economic throughput of SOL and SPL tokens on the Solana blockchain has fallen from a yearly high of almost $47 billion to around $34 billion in over one week.

According to data from The Block, the number of active addresses on the Solana network has also fallen from a yearly high of around 981,000 on Dec. 21 to current levels of around 599,000.

Proposal to deploy Aave v3 on Neon EVM

The Solana network was earlier bouyed by the announcement that the governance body of Aave is considering a proposal to deploy Aave v3 onNeon EVM, which is a smart contract platform that enables Ethereum dapps on the Solana network.

Made by the Neon Foundation and Aave contributor Aave Chan Initiative, this proposal seeks to expand Aave’s lending services to the Solana blockchain as a minimal viable product (MVP) at first. It is currently in the “temperature check” phase — where Aave community members can share their views and feedback on the proposed integration.

If approved, the deployment would allow Aave to utilize Solana’s liquidity for its lending services. According to the proposal, a version of Aave v3 has already been deployed on Neon EVM’s developer-focused testnet (devnet).

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