The Solana blockchain network has been making tremendous strides and is on its way to catching up with Ethereum. Based on hedge fund Syncracy Capital’s recent findings, the market share and the valuation of Solana have increased in a short period, with estimates placing the network at 33% of the worth of Ethereum.
This progress highlights how far Solana has come since being considered an undervalued player in 2023, thanks to its more coherent architecture, higher transactions per second, and simplicity of development. Solana has seen an increasing volume of activity on-chain and growth in users and builders, after shaking off the difficulties caused by the collapse of FTX.
Undoubtedly, the most noteworthy change this month is that Solana set a new record, outperforming Ethereum in terms of monthly application revenue. This is hardly surprising, given the rise in a range of finance and commerce-oriented applications.
Retailers have found Solana very appealing because it is easy to use on mobile devices and has low transaction costs. Apps like Pumpdotfun are showcasing the full potential of Solana’s network, currently generating over $348 million a year.
With about 42 million SOL locked as of October 26, Solana’s total value locked (TVL) has reached a two-year high. In contrast, Ethereum’s TVL has stayed somewhat unchanged, particularly in decentralized finance (DeFi) and decentralized physical infrastructure networks (DePIN), which are both seeing a spike in usage on the platform. This rise in TVL reflects the growing confidence in Solana’s ecosystem.
The appeal of Solana’s ecosystem is steadily on the rise, even vying with Ethereum in the few niches that remain uncontested. The network does not only focus on retail merchants, but is also growing with several innovative DePIN protocols that aim to incentivize users to maintain real-world infrastructure.
Solana’s forthcoming Firedancer upgrade is anticipated to further improve the network’s scalability. Syncracy Capital said this will maintain Solana’s valuation disparity with Ethereum at a low level, thereby establishing it as a formidable competitor.
It is projected that by December 14, 2024, the price of Solana will have appreciated by 12%, hitting $242, according to data from CoinCodex. Considering that the Fear & Greed Index lies within its ‘Extreme Greed’ limits and consumer behavior remains positive, it would be logical to purchase Solana at this point in time. Moreover, there is a likelihood that the price of Solana will also increase, given the efficiency of the network and the month’s growth of 30%.
