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Why Solana will Dump, Solving the Price of Bitcoin

Welcome to my first tweet! In this tweet, I‘d like to present my theory on why Solana is likely to experience a significant dump.

1) Funding rates explained 2) Solana and the funding rates 3) Why Solana will likely dump

BTC ETH SOL BTC ETH Crypto

1) When the funding rate is positive, the price of the perpetual contract is higher than the mark price. On the other hand, when the funding rate is negative, the price of the perpetual contract is lower than the mark price.

1.1) This means that when the funding rate is negative, the mark price is higher than the perpetual contract price.

2) This is exactly what we are seeing with SOL. The price has been rising, which correlates with a positive funding rate. However, even after a 80% pump in SOL's price, the funding rates remain negative.

2.1) In fact, the funding rate has even decreased further as the price of SOL has increased.

3) This leads to the following theory: The funding rate is not going positive because a small number of influential individuals are driving up the price, while more and more people are taking short positions. If the majority of SOL holders are

3.1) shorting the asset but the price can still be pumped by 80%, it could be due to whales artificially driving up the price. Eventually, these whales may give up and sell off their positions, as they do not have unlimited resources.

This post is based on this twitter thread.

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