Key Insights:
- Solana Price eyes rally as SOL TVL now exceeds all Ethereum layer-2 networks combined.
- DApp fee revenue boosts SOL demand amid rising staking participation.
- Analysts warn ETH may outperform SOL in the coming months.
Having fired its price up by 25% in just five days, Solana’s price is skyrocketing! It leapt from $147 on May 6th to a stunning price of $183 on May 10th. What provided this rocket fuel? Perhaps the Bitcoin price charging through the $100,000 mark provided just the perfect injection of fuel that has sparked the whole altcoin market frenzy, with Solana at the peak.
While SOL has since hovered near the $180 mark, growing on-chain activity and derivatives data hint at more upside ahead.
Everyone was not chanting Solana’s victory song. CryptoBullet, a respected market watcher, cautioned as the critical cracks start developing on the SOL/ETH trading pair that Ethereum might soon overshadow Solana.
Solana’s DeFi Ecosystem Outpaces Ethereum Layer-2s
The bright star of the DeFi galaxy! According to DefiLlama, it is currently ranked second as the biggest TVL blockchain, with $10.9 billion in value locked in its arena. Now, that is not just striking but a cosmic shift from arithmetically diminishing the combined might of Ethereum’s preferred layer-2 candidates-Arbitrum, Base, and Avalanche.
Blockchain ranked by TVL, USD. Source: DefiLlama
Solana’s DeFi kingdom is buzzing! By an outright huge 78% gain in TVL in just 30 days, the Raydium DEX had set the tone. Following pleasingly behind were Jito liquid staking at 41%, and Marinade Finance achieved 56%. What does this all indicate? Solana’s DeFi seems to be the new attraction for users! Wherever the users venture forth, chances are, prices pile up behind them. Is a price surge about to grace Solana too?
While the buzz is louder than ever, Solana is gearing for the uplift. Fee revenues are going in the realm. The base-layer fees of Solana are utterly smashing that of $24.9 million of Ethereum, standing at $43.3 million in the past 30 days. Only Tron, at $51.9 million, remains a notch higher. Is Solana the new fee king that we might be seeing?
Fee Revenue and Staking Dynamics Boost SOL Demand
Sky-high fees? Do not despair! They are often the roaring engine of a vibrant network. Take Solana for example: those rising transaction fees are applause, so to speak, from DeFi and DApp users busy building and playing within its ecosystem.
Solana network DApps revenue vs. chain fees. Source: DefiLlama
DeFi is all the rage in Solana these days! Revenue for DApps and chain fees are advancing toward three-month highs, according to DefiLlama. This DeFi boom is creating demand for SOL, which enters life as a medium of exchange with the users buying SOL to get a piece of the action. It’s time to have a Solana summer!
As we say, the sun continues to rise on Solana. As 65% of tokens remain staked, locked away fueling the engine of the network, price in an upward movement is created. This scarcity meets DApp revenue reaching for the skies, and you have the perfect storm for a scorching SOL summer. The bulls have begun ruling.
What Lies Ahead For Solana Price?
It is all flashing green with Solana’s on-chain metrics, but allow no euphoria for now. While the blockchain is soaring, the derivatives market seems to be telling quite a different story. According to Laevitas, the SOL perpetual futures funding rate stands at 8%, in the neutral range. The implication? Traders feel bullish, but they are not acting without rationality. The bull run is gathering steam, but it is not quite in frenzy mode yet.
The champagne has been kept locked away for the SOL bulls, and there is a reason behind this. Funding rates point to long bias, albeit in a very faint voice. There is a divergent sentiment developing; bullish traders are cautiously so as SOL has yet to climb 40% to retest the $295 high of January 2025. It is missing that spark. Absent a catalyst for the breakout, even the staunchest supporters of SOL are in backing off.
SOL perpetual futures annualized funding rate. Source: Laevitas.ch
However, don’t write off Solana just yet. Several positive undertones, whispers about a Solana spot ETF, or the likes of state digital asset reserves could send a wave of buoyant sentiments. Imagine the rush of institutions towards Solana, tempted with the idea of tokenized traditional assets-a game-changer in the work-the-waiting.
Analyst Warns Ethereum Will ‘Crush’ Solana Price Soon
While many feel that Solana (SOL) would drum up the next altcoin rush, the cracks are beginning to show in it. CryptoBullet, one of the sharpest market analysts, recently pointed out a worrying breakdown in the SOL/ETH weekly chart, thereby casting shadows on its ascent to dominance.
The chilling forecast from CryptoBullet reads: “Why would Solana’s sun set over Ethereum? Check the weekly $SOL/ETH chart-it doesn’t look kind for the coming months. Prepare for an #Ethereum eclipse over #Solana.”
Ethereum vs. Solana: a tectonic shift is in the making. Charts suggest a bearish breakdown in the SOL/ETH pair as the rising wedge loses out. But bigger fireworks may burst forth if Ethereum steals the limelight. The rebirth of the ETH trend agitated by fervent ETF buzz might lure away all the capital from Solana and change the direction of fortune. Watch very closely – it is really about to be that defining moment for power.
Inside Solana’s on-chain world, activity is surging with DApp revenues rising, the staking volume at an all-time high, and TVL hitting new heights. But the great titan, Ethereum, is also big and ready to rift with evolving markets and hinting charts.
Solana now finds itself aiming at a charming yet distant $200-a-flash-from-past-famous. While clinging onto what’s left of the price, SOL faces a bigger question of whether it simply fades into oblivion with Ethereum overshadowing once again.
The network’s metrics paint a bullish picture, but traders are watching the SOL/ETH pair closely for what comes next.
Thanks for reading Solana Price Eyes $200 as TVL and Fee Revenues Surge—ETH Threatens to Outpace
