Solana is experiencing significant liquidity challenges as $500 million in long positions are at risk of liquidation if the price falls by 5.5% to $129. On-chain data indicates that realized losses have surpassed profits, reflecting a waning risk appetite among investors. Despite these bearish conditions, institutional investors have injected $17.72 million into Solana spot ETFs this week, suggesting some confidence in the asset's potential recovery. Analysts suggest that the market may be approaching a reset, with a potential bottoming phase anticipated in early January. This period could provide an opportunity for stabilization and recovery, contingent on broader market conditions and investor sentiment.