Solana’s [SOL] derivative market shows a clear disconnect from its falling prices. This is because there is still a significant increase in the amount of leveraged coins being traded, while the dollar value of Open Interest (OI) has declined.
The USD-denominated OI currently sits at approximately $4.04 billion compared to about $7.70 billion last year. That represents a decline of around $3.66 billion and a corresponding decrease of about 47.5%.
On the other hand, the OI for Solana has increased by nearly 21.6 percent when compared to last year and has risen by 9.38 million to reach 52.87 million SOL. This indicates that traders hold more SOL exposure despite the lower dollar valuation.
Meanwhile, SOL trades near $76, far below its peak, explaining much of the USD OI contraction. More importantly, this divergence suggests derivatives have not experienced the broad deleveraging implied by dollar figures alone.
Moreover, speculative positions remain high because traders are maintaining large amounts of leverage relative to their holdings in coins.
Without significant spot buying pressure, it may create an environment where price movements become even more volatile due to the increased sensitivity of price movements to leverage.
As a result, Solana retains substantial liquidation fuel, although open interest alone cannot determine which side faces the next squeeze.
Against Solana’s already elevated derivatives exposure, one whale is now adding significant leveraged risk through a large directional bet. A new wallet deposited $8.43 million in USD Coin [USDC] before targeting a 500,000 SOL long position using 20x leverage.
So far, the TWAP order has filled 199,838 SOL, worth roughly $15.2 million, near a $75.985 average entry. Meanwhile, at the time, SOL traded around $75.94, leaving the filled position slightly underwater by roughly $8,888.
More importantly, because the TWAP will execute over some period of time, it will limit the whales’ immediate impact upon the market while steadily increasing long exposure. If the whale continues to accumulate SOL, there may be further support for longs.
However, due to the 20X leverage, margin calls are likely when SOL rapidly moves downward.
Solana’s supply shift raises the stakes for leverage
Solana is considering two supply changes that would reduce SOL circulation through different mechanisms. SIMD-0550 would speed up inflation cuts, potentially removing 18.9 million SOL from future issuance.
Meanwhile, SIMD-0553 would change transaction fees based on how much computing power users consume. Solana would then burn those fees entirely, potentially raising daily burns from 650 to 7,500–9,000 SOL.
Together, slower issuance and higher burns could tighten supply, strengthening leveraged bullish positions if spot demand remains firm.
Final Summary
- Solana leverage remains elevated despite lower USD open interest, with a whale adding a 20x long position.
- Potential supply cuts could support SOL, but weak spot demand would leave growing leveraged exposure vulnerable to liquidation.
