Solayer’s $350M Wipeout: Why Did LAYER Crash 62% Overnight?
Solayer’s LAYER token plummets 62% in 2 days, erasing $350M. Token unlocks and whale exits spark panic—can it recover?
Solayer’s $350M Wipeout: Why Did LAYER Crash 62% Overnight?
Solayer, a hardware-accelerated blockchain built on Solana, saw its native token LAYER crash 62% from $3.41 to $1.29 in just two days, wiping out $350 million in market value. This dramatic drop, starting May 5, 2025, reversed LAYER’s 460% gains from February to early May, leaving investors reeling. So, what triggered this freefall?
What Happened?
The plunge coincides with an upcoming token unlock on May 11, set to release 13% of LAYER’s supply (~27 million tokens). Fear of dilution sparked heavy selling, amplified by thin liquidity and whale activity. X posts report a large holder quietly exiting via over-the-counter (OTC) sales and short positions, with 6.9 million LAYER sent to Binance in March. Trading volume spiked to $1 billion in 24 hours, signaling panic.
The plunge coincides with an upcoming token unlock on May 11, set to release 13% of LAYER’s supply (~27 million tokens). Fear of dilution sparked heavy selling, amplified by thin liquidity and whale activity. X posts report a large holder quietly exiting via over-the-counter (OTC) sales and short positions, with 6.9 million LAYER sent to Binance in March. Trading volume spiked to $1 billion in 24 hours, signaling panic.
Why It Matters
For new investors, this highlights crypto’s volatility. Solayer’s tech—aiming for 1 million transactions per second and offering an Emerald Card for USDC spending—remains promising. Yet, token unlocks often pressure prices as early investors cash out. The Solayer team insists the project is “fundamentally strong,” blaming reckless liquidations, not internal issues.
For new investors, this highlights crypto’s volatility. Solayer’s tech—aiming for 1 million transactions per second and offering an Emerald Card for USDC spending—remains promising. Yet, token unlocks often pressure prices as early investors cash out. The Solayer team insists the project is “fundamentally strong,” blaming reckless liquidations, not internal issues.
What’s Next?
LAYER’s $1.20 support level is critical. A recovery could hinge on restored confidence and Solana’s bullish ecosystem, with SOL at $155. However, macro risks like U.S.-China trade tensions could delay a rebound. Beginners should approach cautiously, as volatility persists.
LAYER’s $1.20 support level is critical. A recovery could hinge on restored confidence and Solana’s bullish ecosystem, with SOL at $155. However, macro risks like U.S.-China trade tensions could delay a rebound. Beginners should approach cautiously, as volatility persists.
Share Your Thoughts
Is Solayer a dip to buy or a red flag? Comment below and stay tuned to trafy.io for more crypto updates!
Is Solayer a dip to buy or a red flag? Comment below and stay tuned to trafy.io for more crypto updates!
NOTICE:
The information provided on trafy.io does not constitute investment advice or recommendations. All investment and trading activities involve risks, and readers are advised to conduct their own research before making decisions.
NOTICE:
The information provided on trafy.io does not constitute investment advice or recommendations. All investment and trading activities involve risks, and readers are advised to conduct their own research before making decisions.
