"Solana Whales Bet Big on Bearish Options Amid Price Drop and Upcoming Unlock"

Solana Whales Boost Bearish Options Activity on Deribit Amid SOL Price Decline and Upcoming Unlock

Deribit's options market for Solana's SOL token has seen increased activity, with whales engaging in bearish bets as the token's price continues to decline ahead of a significant upcoming unlock event. Last week, SOL block trades totaling $32.39 million in notional value were executed on Deribit, representing nearly 25% of the total options activity of $130.74 million. This is the second-highest proportion of block trades to total activity on record, according to Amberdata.

A "block trade" in options refers to a significant, privately negotiated options transaction between two parties involving a large number of contracts. Such trades are executed over-the-counter and outside the regular order book, allowing for a minimal impact on market prices. Options are derivative contracts that give the purchaser the right but not the obligation to buy or sell the underlying asset, in this case, SOL, at a preset price on or before a specific date. A call option gives the right to buy, while a put option provides the right to sell. On Deribit, which accounts for over 85% of the global crypto options activity, one options contract represents 1 SOL.

Last week's spike in SOL block trades featured a preference for put options, which traders use to hedge against or profit from a potential price slide. Nearly 80% of the block-trade volume was concentrated in put contracts, compared to only 40% puts for BTC and 37.5% puts for ETH during the same timeframe, according to Greg Magadini, director of derivatives at Amberdata.

The whale demand for put options comes as SOL's outlook appears grim following a 46% price slide to $160 in just over five weeks. The activity on the Solana blockchain, which became a go-to-place for memecoin traders last year, peaked with the launch of the TRUMP token on Jan. 17, three days before Donald Trump was inaugurated as the President of the U.S. Since then, the number of daily transactions on Solana and the cumulative daily volume on the Solana-based decentralized exchanges has declined significantly, weakening the bullish case for SOL.

Moreover, the impending SOL token unlock on Jan. 1 presents