Solana Tops Ethereum in Volume: Is This the Real Flippening?
Solana Competes With Ethereum| Source: Gerd Altmann/Pixabay
Key Takeaways
- Solana’s DEX trading volume exceeds Ethereum.
- It also eclipsed other chains in daily active addresses.
- SOL has also overtaken Binance Coin in terms of market capitalization.
Solana’s performance is making headlines as it has outpaced Ethereum in terms of trading volume. Users associate “flippening” with a hypothetical scenario where Ethereum will surpass Bitcoin in terms of market capitalization. Is the ETH competitor signaling a shift in dominance before that happens?
Rise in Solana Activity
Solana’s trading volumes and network activity are competing to be on the top. Market data has revealed that Solana has seen a dramatic increase in daily active addresses, surpassing every other blockchain in this metric. The uptick in activity is largely attributed to the widespread interest in memecoins. Meanwhile, the on-chain volume for Solana has exceeded that of Ethereum.
According to Dexscreener, Solana’s 24-hour volumes on March 18 are over $5.3b while Ethereum stands at 1.85b. In terms of transactions, ETH is way behind close to 250k while Solana has exceeded 7.6m during the same period.
At the time of writing, Solana has 4.3b dollars locked based on DefiLlama data . Ethereum is the dominating chain with $51.8b TVL. However, Solana has emerged as the top non-EVM chain. A non-EVM chain operates without the Ethereum Virtual Machine, employing alternative systems for smart contract execution.
In terms of price, Solana has also surpassed the Binance Coin (BNB). Based on CoinGecko data , SOL has secured the position as the fourth-largest crypto by market capitalization.
At press time, the market capitalization has gone north of $91b, almost $6b above BNB.
Trading Leads to Higher Fees
Data by Token Terminal reveal that Solana’s 30-day fee collection and revenue, both have seen over 75% increase. The numbers are positive for the annualized fees for the chain as well. Daily active users at 2m have seen almost a 380% increase.
Transactions per second (TPS ) or the number of transactions SOL can process in one second is over 2,300 on March 18.
Tristan Frizza, co-founder of Zeta Markets, a crypto perpetual exchange powered by Solana remarked on the chain’s achievements.
Frizza said, “Solana’s all-time high in daily new addresses and transactions surpassing that of Ethereum and its L2s, is a testament to the blockchain’s resilience, speed, and the faith of its community.”
The executive added, “This isn’t merely about one blockchain outperforming another; it’s about the democratization of access to DeFi, the realization of blockchain’s true potential, and the dawning of a new era where speed, security, and ease of use become the bedrock of digital finance.”
He believes this milestone is not just about one blockchain outperforming another but represents a broader shift towards the democratization of DeFi and a new era of digital finance. Frizza said, “Just as we’ve witnessed institutional interest drive Bitcoin’s ETF approvals, Solana’s robust fundamentals and genuine user activity position it as a frontrunner in the race for broader adoption.”
While decentralized exchange (DEX) trading volume underpins Solana’s surge, the Google Trends are also in its favor.
Solana’s search interest has reportedly reached an all-time high.
Despite the opportunities presented by trading memecoins on the eco-friendly chain, users should pay attention that not all ventures end in profit.
Solana Offers Promise
Solana’s overtaking of Ethereum in trading volume marks a potential ‘flippening’ event. With its swift growth and rising adoption, SOL challenges Ethereum’s dominance in the smart contracts front, already securing fourth place with favorable returns for investors. However, the aftermath of Ethereum’s Dencun upgrade which promises lower fees is ensuring the competition between these two chains remains fierce.
