(Bloomberg) -- Solana, the blockchain network once championed by Sam Bankman-Fried, is drawing immense scrutiny as industry watchers wonder whether its former close ties to the disgraced crypto mogul and his now-defunct FTX empire will jeopardize its future. 

Its founders are doing everything they can to break that connection.

The price of Solana’s crypto token, SOL, has plummeted 96% from its all-time high of $260 in November 2021 to about $10, hurt first by a year-long crypto rout that engulfed the whole market and then again by FTX’s fall. SOL dropped as much as 12% on Wednesday alone on concern large holders are offloading the token, which is used as the base cryptocurrency for financial transactions on the blockchain.

Anatoly Yakovenko, co-founder of Solana Labs Inc., the startup that developed the blockchain, said in an interview earlier this month that he doesn’t usually comment on price, and that the focus instead should be on “the technology and having people build something awesome that’s decentralized.” 

But the collapse of FTX is having an impact — both personal and professional — on Solana and its founders. And the token’s drop can be seen as an expression of waning confidence in the whole platform, which at its peak sported a market value of almost $80 billion and is now a tiny fraction of that. 

Prior to FTX’s bankruptcy and Bankman-Fried’s arrest in December on charges that include multiple types of fraud, the one-time crypto kingmaker was a major supporter of Solana, a blockchain billed as a faster and more efficient alternative to the market-leading Ethereum network. Bankman-Fried even appeared with Yakovenko at conferences and virtual fireside chats. 

“I’m still trying to square what I perceive him to be and like what actually happened,” Yakovenko said in a joint conversation on Dec. 16 with his Solana co-founder Raj Gokal. “It just feels really, really jarring.” 

Yakovenko said roughly 4% of teams building projects on Solana now were acutely affected by FTX’s collapse. Some platforms had funds custodied on the crypto exchange. About 80% of teams on Solana’s blockchain had no exposure at all to FTX, Yakovenko said, referring to survey data, adding that he was connecting severely impacted founders with investors who could potentially provide emergency capital.

“There’s definitely more to Solana than FTX,” Yakovenko said.

Still, the network’s longstanding ties to FTX and Alameda Research, the crypto trading firm co-founded by Bankman-Fried, may make it hard for some to move past the association. The two firms helped support Solana by purchasing SOL tokens in bulk from the Solana Foundation, the nonprofit that helps support the blockchain. Alameda also bought large quantities of SOL from Solana Labs.

Overall, the transactions between FTX and Alameda and the Solana Foundation and Solana Labs involved 58,086,686 SOL tokens, according to a Solana Foundation blog post in November. That amount is equivalent to more than $580 million based on the current price of the token.

Alameda and FTX’s venture arm also invested in multiple projects that operated on Solana, while FTX built its own projects on the network, including the decentralized finance platform Serum. These types of efforts, from an industry leader with substantial influence in the market, helped introduce Solana to many crypto users, Gokal said. “They first really started hearing about it when SBF and FTX decided to start building on Solana,” he said, referring to Bankman-Fried by his initials as many do. 

FTX US, the American affiliate of the crypto exchange, launched its NFT marketplace on Solana last year, despite Ethereum being the blockchain of choice for many NFT projects. The marketplace is no longer operational, with its website linking to FTX’s bankruptcy information page and links for NFTs created on the platform now broken. 

In its November blog post, the Solana Foundation said in its November blog post it had less than $1 million of cash or cash equivalents on FTX.com as of Nov. 6, when the crypto exchange ceased withdrawals, and that the organization did not know how FTX and Alameda’s assets will be settled during bankruptcy proceedings. 

Yakovenko said they still did not have further clarity on what would happen to the holdings as the bankruptcy proceedings move forward, but Gokal noted, “there’s no impact on the security of the network from things like the concentration of SOL tokens on Alameda’s balance sheet.” 

Still, following FTX’s collapse, some crypto projects are leaving the Solana network, which has also experienced multiple outages in the last year. DeGods and y00ts, two well-known NFT projects on Solana, are switching to Ethereum and Polygon, respectively.

As for Serum, with the decentralized exchange in distress following the collapse of FTX, a new version of the platform called Openbook was launched through a blockchain update process known as a “fork” by developers who build on Solana. 

Solana had “outgrown” Serum, according to Gokal. In fact, he added, major crypto exchanges are now more interested in working with Solana following FTX’s collapse, after previously keeping the network “at arm’s length” because “there was this perception that there was closeness between FTX and Solana.”

He said that the controversy surrounding Bankman-Fried will fade as more digital-asset leaders step into the space and build on networks like Solana.

“Crypto has a pretty short memory,” he said.

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