SOL gains as Ethereum FUD sparks rotation — SOL/ETH at key support
Solana (SOL) is showing signs of capital rotation from Ethereum (ETH) amid recent ETH-focused FUD and outflows. Key on-chain and trading metrics favor SOL: Solana’s perpetuals trading volume reached $12.1 billion versus Ethereum’s $9.6 billion (about 26% higher), and Solana’s stablecoin supply rose 8.5% this week driven by $2.75 billion in USDC minting on Solana compared with Ethereum’s nearly flat 0.2% stablecoin change. Institutional flows also diverged — ETFs recorded roughly $18 million net outflows for Solana over three days versus about $180 million outflows for Ethereum. The SOL/ETH ratio is trading around 0.04, a level that previously preceded a 35% SOL rebound during Q3 2025, suggesting potential upside if the ratio holds. Additional pressure on ETH came from large holder moves flagged by LookOnChain and Trend Research selling nearly all their ETH (withdrawal of 792,532 ETH and later a partial redeposit), contributing to negative sentiment. For traders, these developments point to possible short-term rotation into SOL, higher trading liquidity on Solana, and a risk-reward setup that could support a SOL rally if on-chain activity and perp volumes persist. Monitor SOL/ETH ratio, stablecoin minting flows on Solana, perp volumes, and ETF/institutional activity for confirmation.
Bullish
The article highlights measurable rotation signals favoring Solana: higher perpetuals volume, rising stablecoin supply on Solana (driven by $2.75B USDC minting), and relatively smaller ETF outflows compared with Ethereum. The SOL/ETH ratio holding at ~0.04 — a historical support that preceded a 35% SOL rebound in Q3 2025 — increases the probability of a similar short-term rally if on-chain activity and trading interest persist. Large ETH holder moves and ETF-driven outflows amplify bearish pressure on ETH, making capital reallocation to SOL plausible. Short-term impact: likely increased volatility with upside bias for SOL as traders chase rotation and momentum; key triggers to watch are sustained perp volumes, continued stablecoin minting on Solana, and ETF/institutional flows. Long-term impact: if the rotation is structural (i.e., persistent higher activity and capital on Solana), SOL could see a sustained bullish trend, but risks remain — macro volatility, re-accumulation by ETH stakeholders, or a reversal in perp flows could negate gains. Historical parallel: previous SOL/ETH support at ~0.04 led to a sharp SOL rebound in 2025, showing that ratio-based rotations can drive rapid altcoin moves. Overall, indicators point to a bullish setup for SOL but require confirmation from continued on-chain and institutional metrics.