Solana (SOL-USD) saw a staggering $485 million in outflows throughout February as investors scrambled for safer alternatives. According to Binance Research, much of this capital shifted to Ethereum (ETH-USD), Arbitrum (ARB-USD), and BNB Chain (BNB-USD), reflecting a broader sentiment of risk aversion in the crypto market. “Overall, there is a broader flight towards safety in crypto markets, with Bitcoin dominance increasing 1% in the past month to 59.6%,” noted Binance Research.
Macroeconomic Uncertainty and Hacks Shake Confidence
The turbulence didn’t come out of nowhere. Market-wide uncertainty, fueled by macroeconomic concerns and the catastrophic $1.4 billion Bybit hack, sent shockwaves through the industry. Binance Research highlighted that overall cryptocurrency market capitalization dropped 20% in February.
Memecoin Scams on Solana Fuel Investor Exodus
Adding to the chaos, the collapse of Solana-based memecoin projects, including Libra, only worsened sentiment. The token, which had been endorsed by Argentine President Javier Milei, turned out to be a classic rug pull. Insiders allegedly drained over $107 million, leading to a 94% price collapse within hours and wiping out $4 billion in investor capital. Anastasija Plotnikova, CEO of Fideum, criticized the shift in the memecoin space, stating, “Insider rings, pump-and-dump schemes, and sniper groups have replaced the organic, collectible nature of original memecoins, creating an unhealthy playing field.”
Stablecoins and RWAs Surge as Investors Seek Stability
While Solana bled capital, stablecoins and real-world assets (RWAs) surged to all-time highs. On-chain RWAs hit $17.1 billion, while stablecoins exceeded a record $224 billion, according to Cointelegraph. Alexander Loktev, chief revenue officer at P2P.org, predicted RWAs could hit $50 billion in 2025 as investors seek predictability in uncertain times.
Crypto’s Flight to Safety Continues
The recent turmoil has shown a clear shift in investor behavior. With scams, hacks, and economic uncertainty looming, many are playing it safe. If these trends persist, Solana could face an uphill battle in regaining investor trust.
At the time of writing, Solana is sitting at $141.42.
