The Solana community outpaced Ethereum in month-to-month decentralized change (DEX) quantity in July, in accordance with DefiLlama knowledge.
Solana’s DEX transactions reached $55.8 billion, surpassing Ethereum’s $53.8 billion for a similar interval. This represents Solana’s second-highest month-to-month quantity, following March 2024’s peak of $60.7 billion.
Solana’s quantity spike is principally attributable to exercise on platforms like Raydium, Orca, and Phoenix. In distinction, Ethereum’s quantity is predominantly pushed by the Uniswap change.
Regardless of these figures, Ethereum stays the main DeFi platform, holding roughly 61% of the market and locking $67 billion in belongings. As compared, Solana instructions solely 4.64% of the market, with a complete worth locked (TVL) of $5.16 billion.
What’s driving Solana’s progress?
Analysts level to an increase in memecoin exercise as a key driver behind Solana’s elevated DEX quantity.
Over the previous yr, the blockchain has skilled vital progress in varied memecoins, from cat-themed to politically impressed tokens. This has led to elevated liquidity as merchants look to capitalize on these belongings.
Institutional endorsements have additionally fueled curiosity in Solana, and hypothesis a few potential Solana exchange-traded fund (ETF) could have contributed to its progress. In June, outstanding asset administration companies VanEck and 21Shares utilized with the US Securities and Trade Fee (SEC) to create a spot-based Solana ETF.
Additional, market analysts have famous elevated utilization of stablecoins on Solana. Data from Allium on Visa’s stablecoin dashboard exhibits that the transaction quantity for the USDC stablecoin on Solana has exceeded $8 trillion because the starting of final yr, with USDT on the Tron blockchain following at $6.5 trillion.
Wash-trading considerations
In the meantime, Solana’s current surge in DEX buying and selling has raised considerations about potential wash buying and selling. A current report by the pseudonymous crypto analyst Flip Analysis claims that 93% of transactions on the blockchain are inorganic.
The report signifies that Solana’s every day transactions are closely influenced by wash buying and selling, MEV bots, and scams, which provide minimal worth to retail merchants. Flip Analysis famous:
“Wanting on the wallets concerned, the overwhelming majority appear to be bots in the identical community with tens of 1000’s of transactions. They generate pretend volumes independently, with random quantities of SOL and a random no. of transactions till the mission rugs, earlier than shifting onto the subsequent one.”