The Solana blockchain continues to carve its place in the decentralized finance (DeFi) landscape, gaining attention for its growing trading volumes and ecosystem dynamics. Recent data highlights Solana's ability to surpass Ethereum and Base in decentralized exchange (DEX) trading activity, while founders within the network weigh in on the opportunities and challenges shaping its future.
Solana Overtakes Ethereum and Base in DEX Trading Volume: A New DeFi Powerhouse Emerges
The Solana network has made a groundbreaking leap in the decentralized finance (DeFi) space, surpassing Ethereum and Base combined in 24-hour decentralized exchange (DEX) trading volume. According to data from DefiLlama, daily trading volume across Solana-based DEXs neared $3.8 billion on Jan. 6, dwarfing Ethereum’s $1.7 billion and Base’s $1.2 billion.
The Solana network’s rise is not merely a matter of trading volume; it reflects a broader shift in the DeFi landscape. Solana has consistently demonstrated significant growth in metrics like price performance and total value locked (TVL), positioning itself as an attractive alternative for both developers and retail traders.
Since 2023, Solana’s native token, SOL, has outperformed Ethereum’s ETH by approximately eight times, according to data from TradingView. Furthermore, Solana’s TVL experienced explosive growth in 2024, skyrocketing from $1.4 billion to more than $9.5 billion, a nearly fivefold increase, according to DefiLlama.
Grayscale Research noted in December that Solana’s appeal lies in its accessibility for retail traders. The network has become a hub for speculative trading on assets like meme coins and AI agent tokens, which have captivated the crypto community.
Solana’s dominance in DEX trading is closely tied to the success of Raydium, the network’s flagship decentralized exchange. Raydium has seen its 24-hour trading volumes grow by more than tenfold in 2024, surging from $180 million in January to over $3 billion by Dec. 31, as per DefiLlama.
Raydium’s competitive edge became evident in November, when it surpassed Uniswap, Ethereum’s leading DEX, in monthly trading volumes by approximately 30%, or around $30 billion, according to Messari Research. Although Uniswap regained its lead in December with $92 billion in trading volume compared to Raydium’s $61 billion, the Solana-based DEX maintained its position as a dominant force within its ecosystem.
A key driver of Raydium’s success has been its strong foothold in meme coin trading. In November, meme coins accounted for an all-time high of 65% of Raydium’s monthly trading volume, further solidifying its role as a hub for speculative assets.
Meme Coins and Venture Capital: Fueling Solana’s Rise
Meme coins have emerged as a significant catalyst for Solana’s rapid growth. Fueled by venture capital funding and speculative trading, meme coins now command an estimated $130 billion in market capitalization, according to CoinGecko.
Solana’s meme coin ecosystem is anchored by platforms like Pump.fun, which has become a top-earning blockchain protocol. In November, Pump.fun generated nearly $250 million in trading volume, placing it among the industry’s elite, just below giants like Uniswap and Circle, the issuer of USD Coin (USDC).
The trading lifecycle of meme coins minted on Pump.fun typically begins with liquidity bootstrapping on the platform, followed by active trading on Raydium. This synergy has further entrenched Solana’s position as a DeFi powerhouse.
Despite its recent achievements, Solana faces challenges in maintaining its momentum. Ethereum continues to enjoy a robust developer ecosystem and institutional backing, while Base benefits from its integration within the Ethereum network.
However, Solana’s innovations in scalability and cost efficiency—key pain points for Ethereum—make it a formidable challenger. The network’s ability to attract retail traders, supported by a thriving ecosystem of DEXs and speculative assets, positions it well for future growth.
Solana’s meteoric rise signals a broader transformation in the DeFi landscape. Its ability to outpace Ethereum and Base in DEX trading volume reflects not only technical superiority but also its appeal to a new wave of crypto users. As Solana continues to grow, it could reshape the dynamics of decentralized finance, offering a glimpse of what a post-Ethereum DeFi ecosystem might look like.
With a combination of strong community engagement, innovative use cases, and sustained trading activity, Solana appears poised to maintain its upward trajectory in 2025 and beyond.
Solana Founders Embrace Meme Coins but Sound Alarm on MEV Concerns
A new survey by Blockworks Research sheds light on the perspectives of Solana ecosystem founders, revealing their enthusiasm for meme coins, skepticism toward artificial intelligence (AI) agents, and mounting concerns about the growing issue of maximum extractable value (MEV). The survey, conducted with 42 Solana-based project founders, provides a comprehensive snapshot of the sentiment within the network as it navigates both opportunities and challenges.
The majority of Solana founders—approximately 76%—view meme coins as “mostly good” for the ecosystem, underscoring their significant role in attracting retail traders and driving activity on the network. Since 2023, Solana-based meme coins have emerged as a defining feature of the blockchain, bolstered by speculative trading and platforms like Pump.fun, which has facilitated over $8.5 billion in total volume since its January launch, according to DefiLlama.
The rising prominence of meme coins has also contributed to Solana’s total value locked (TVL) skyrocketing from $1.5 billion at the start of 2024 to nearly $8.5 billion by December. This rapid growth is reflected in Solana’s price performance, with SOL outpacing Ether (ETH) by approximately eight times during the same period, according to TradingView.
Grayscale Research noted in December that Solana’s success is closely tied to its accessibility for retail traders and the speculative appeal of assets like meme coins. The total market capitalization of meme coins has ballooned from $20 billion in 2023 to over $120 billion in 2024, according to CoinGecko, highlighting their growing significance in the crypto ecosystem.
Despite the growing buzz around artificial intelligence, Solana founders expressed skepticism about AI agents, with 16% identifying them as “the most overrated Solana sector.” These AI-driven tokens, designed to support machines with autonomous goal-pursuit capabilities, have seen significant market activity but remain controversial.
In 2024, tokens tied to AI agents amassed a combined market capitalization of approximately $16 billion, with much of the growth concentrated in the fourth quarter. Solana has been a hotbed for these projects, with tokens like Zerebro (ZEREBRO), Fartcoin (FART), and ai16z (AI16Z) surpassing $100 million in market capitalization. Social media platform X has played a pivotal role in popularizing these tokens, driving their adoption among retail traders.
However, industry experts warn of potential pitfalls. “Crypto AI agents can be a bubble if you look at just the narrative, where most are scams or will never deliver,” said Condz, founder of Web3 startup Acolyte AI, in a Dec. 29 post on X.
While Solana’s rapid growth is a telling sign of its scalability and low-cost transactions, its ecosystem is grappling with a growing MEV problem. More than 20% of survey respondents identified MEV, or maximum extractable value, as Solana’s most pressing issue.
MEV arises when validators prioritize or reorder transactions within a block in exchange for tips from users. While this practice can ensure the smooth execution of transactions, it also leads to higher costs for users.
In 2024, Solana validators earned more from MEV than their Ethereum counterparts for the first time, marking a pivotal moment in the network’s evolution. However, this milestone coincided with a near tripling of transaction fees on the Solana network, according to Dune Analytics.
The growing prevalence of MEV has sparked debates about its long-term impact on the network. While MEV provides validators with additional revenue, it raises concerns about fairness and accessibility, particularly for retail users.
The Alternatives: Base and Sui
When asked which blockchain they would choose if Solana were unavailable, many founders pointed to Base, Coinbase’s Ethereum layer-2 solution, or Sui, a layer-1 blockchain competing directly with Solana.
Base’s integration with Ethereum and Sui’s focus on unique execution models make them appealing alternatives. However, Solana’s combination of scalability, vibrant community, and retail trader engagement continues to give it a competitive edge.
As Solana enters 2025, it faces both opportunities and challenges. The network’s embrace of meme coins has cemented its position as a retail-friendly blockchain, driving trading volumes and developer activity. However, skepticism around AI agents and concerns about MEV underline the need for careful navigation of these issues to maintain its momentum.
With its robust ecosystem and innovative projects, Solana is well-positioned to remain a dominant force in the blockchain space. However, addressing concerns like MEV and ensuring the sustainability of its rapid growth will be critical for its long-term success.
