Solana Faces Deep Profitability Reset as 79.6% of Supply Moves Into Loss

Solana’s profitability sharply contracts as nearly 80% of circulating supply enters loss, reflecting a major structural reset across recent trading sessions.

Market positioning shifts quickly after extended profit-heavy conditions, leading to a steep decline in Percent Supply in Profit as price loses momentum.

Institutional inflows and steady network activity remain present despite the downturn, supporting market interest as Solana trades near crucial support levels.

Solana’s on-chain data shows a sharp drop in profitability as the asset trades near $126.9, marking one of its deepest resets since the 2022 market downturn.

Sharp Profitability Contraction Amid Price Pullback

Glassnode reported that Solana’s Percent Supply in Profit has fallen to about 20%, leaving around 79.6% of circulating tokens in loss. This shift reflects a rapid move away from the extended conditions seen earlier in the year. The tweet noted that nearly 478.5 million SOL now sits below cost basis as market pressure accelerates.

For months, Solana traded with most of its supply in profit, often above the 80% to 90% region. That phase supported aggressive bidding during the rally toward its highs above $280. As selling resumed, the profitability curve dropped in near-vertical form, matching the price decline. This change resembles earlier periods where traders reduced exposure after extended upward moves.

The recent move shows a complete shift from elevated confidence to broader caution. Late-cycle buyers who accumulated between $150 and $200 now dominate the group holding at a loss. This reset reflects a market clearing phase that typically follows rapid speculative expansion, although short-term stabilization remains dependent on price behavior around support levels.

Price Pressure Builds as Market Searches for Support

Solana fell to $122 last week before stabilizing near $128, maintaining a tight range during a period of reduced risk appetite. The drop from its yearly peak has brought the market toward areas that traders view as decisive zones. Bears focus on potential moves toward $100 if current support breaks under renewed selling.

The $120 to $130 region has become a key reference point as trading activity clusters around these levels. The region marked the first area of buying interest after the steep profitability drop. A move away from this area could define the next phase of market direction, with volatility expected as liquidity shifts.

Meanwhile, resistance near $135 remains an important threshold. A sustained break above this region would help offset the pressure created by the profitability reset. Market participants continue to monitor whether buyers can regain control after the sharp unwind.

Institutional Flows and Network Activity Remain Steady

Despite the decline, U.S. spot Solana ETFs recorded steady inflows during the recent drawdown. This trend shows ongoing interest from institutional participants seeking exposure during lower pricing phases. These inflows added stability during periods of increased market stress.

Solana’s network activity has remained active, with more than $1 trillion in DEX volume recorded this year. This milestone positioned Solana as the first Layer 1 outside Ethereum to reach such levels. Activity supported broader confidence during the earlier rally and continues to provide structural backing during the downturn.

Together, ETF participation and network usage have offered counterbalance as profitability metrics reset. Traders now watch whether these elements can help guide sentiment as Solana tests support and evaluates its path forward.

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