Galaxy Digital Solana Purchase Over $1B Signals Institutional Demand

Galaxy Digital has made another big move into Solana. Blockchain data from Lookonchain shows the company bought nearly 5 million SOL in just three days, worth about $1.16 billion.

Out of this, 4.7 million SOL (worth $1.11 billion) has already been moved to Coinbase Prime custody.

The rest, about 219,830 SOL ($53.5 million), remains in Galaxy Digital’s wallet, possibly for active use.

Source: X (formerly Twitter)

This significant buy highlights the increasing significance of this activity within the crypto space.

By transferring this much amount of the holding to regulated custody, the company demonstrates that it has a vision and prioritizes security.

Confidence or Short-Term Risk?

The purchase indicates powerful institutional faith in this altcoin. However, analysts caution that extreme moves like this can ignite the market fast.

Technical charts demonstrate that crypto's CRSI is in overbought territory now, which could translate to a short-term correction if investors begin selling to take profits.

Still, many experts believe Galaxy Digital’s strategy is not just a quick trade. By holding such a large amount in custody, it looks more like a carefully planned position for institutional client s rather than a fast gamble.

Impact on Solana’s Price

This isn’t the first time that this firm has made a bold move. Just days ago, it bought more than 706,000 SOL worth $160 million. That pushed its 24-hour total to over 2.1 million tokens, valued at about $486 million. Soon after, Solana price jumped from $222 to $235, where it has managed to stay strong.

Source: CoinMarketCap

The coin is now trading at $243 with an increase of 2.53% in the last 24 hours as per the CoinMarketcap.

Now, with nearly 5 million more tokens added in less than a week, the impact is much bigger.

Social media buzz is at its peak, though some critics point out that Solana’s decentralization could be tested if too many tokens are held by large firms.

Stock Market Reaction

The big Sol tokens buys have already shown an effect on Galaxy Digital stock.

Source: Google Finance

• On September 12, shares closed at $29.70, up 2.87% for the day.

• The stock touched a high of $30.30 before ending slightly lower.

• The firm’s market value now stands at $1.13 billion, with shares trading near the top of their 52-week range ($17.40 – $33.16).

The rise shows that investors see the Galaxy Digital Sol strategy as a bullish sign.

More than $1.1 billion in Sol moved into custody, investors believe the firm is positioning itself strongly for future development.

Solana Network Growth Adds Support

Institutional confidence of organisations like Galaxy Digital and Sol Strategies comes from Solana’s network growth.

The blockchain has processed 58 million monthly active users and handled about $290 billion in 30-day transaction volume.

Activity from DeFi, memecoins, and stablecoins continues to accelerate utility.

On the technical side,

• It has broken above the 23.6% Fibonacci level at $227.79. It is supported by a bullish MACD crossover.

• With RSI near 71, the market looks overheated, raising chances of a short-term pullback.

Final Thoughts

The recent Galaxy Digital Solana purchase demonstrates the extent to which large institutions are influencing the cryptocurrency market. Though charts signal risks in the short term, the magnitude of the acquisition and the settlement into custody demonstrate true conviction.

The question now is if other companies will take Galaxy Digital's path. If more institutions buy in, the altcoin may experience even more robust adoption and price appreciation.

For the time being, traders wait and observe to see if the cryptocurrency can continue to stay above $227 as whales and institutions continue to make their plays.