Solana has solidified its position as a leading web3 hub following a recent network upgrade aimed at resolving transaction congestion. However, the price of Solana (SOL) has remained bearish in the past five weeks, mirroring the overall trend in the crypto industry as it awaits a bullish signal from Bitcoin.
The Solana network, which is supported by top-tier institutional investors and a thriving online community, continues to make significant strides in the tokenization of real-world assets. According to data from defillama, the Solana network boasts a stablecoin market cap of over $3.2 billion and a bridged total value locked (TVL) of more than $20 billion.
In comparison, the Binance Smart Chain (BSC) has a stablecoin market cap of approximately $5.1 billion and a bridged TVL of $12 billion. The measure of bridged TVL on a layer one chain is crucial as it indicates the level of interoperability of its underlying DeFi platforms.
Visa has highlighted the increasing demand for stablecoins based on the Solana network. According to on-chain data provided by Visa, Solana has outperformed other layer-one chains in terms of stablecoin transactions over the past 30 days. Surprisingly, Ethereum (ETH) had fewer than 20 million stablecoin transactions during this period, as reported by Visa.
Other layer-one chains with less than 20 million stablecoin transactions in the past 30 days included Tron (TRX), Avalanche (AVAX), and Optimism (OP). In contrast, the Solana network recorded over 120 million stablecoin transactions in the same timeframe. The closest competitor to Solana in terms of stablecoin volume is the Binance Smart Chain (BSC), which registered around 70 million transactions.
In terms of specific stablecoins, Visa noted that Circle’s USDC on the Solana network has recorded over 1.23 billion transactions since January 2023, amounting to approximately $4.59 trillion. Additionally, the Solana network has seen a total of 166 million transactions in Tether’s USDT, worth around $278 billion. Therefore, Solana accounted for the majority share of the 352 million stablecoin transactions, totaling approximately $2.3 trillion, in the past 30 days.
The success of Solana can be attributed to its thriving ecosystem of meme coins and other web3 projects. Market data from Coingecko shows that Solana-based meme coins have a combined valuation of around $7 billion and an average daily trading volume of approximately $1 billion.
Furthermore, the Solana core developers have been diligently working on a network upgrade to ensure sustainable adoption and enhance competition with other web3-based blockchains in terms of user acquisition.
Despite the recent bearish sentiment, Solana’s price has experienced significant growth over the past year, gaining over 500 percent to reach around $136 as of April 29, 2024. From a technical perspective, as long as the bulls can maintain the support level around $124, the SOL price against the US dollar is expected to continue on an upward trajectory. If the ETH/BTC pair rebounds in the coming weeks, SOL is likely to lead the altcoins in a generally bullish market outlook.
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