Is Solana's Future at Risk? Three Key Factors to Watch

The crypto market alternates between spectacular surges and abrupt corrections, and Solana is no exception. After a tumultuous start to the year, marked by heightened volatility, the SOL token lost 17.2 % in just three days, bringing its price down to $235. This drop, although brutal, does not alone summarize the situation of the ecosystem. Behind the decline in price, contrasting signals are emerging. On one hand, on-chain activity is collapsing with a 40 % drop in transaction volumes, which weakens major platforms like Orca (-62 %) and Meteora (-45 %). On the other hand, Total Value Locked (TVL) surged by 27 %, surpassing Ethereum and BNB Chain, thanks to platforms like Raydium and Binance Staked SOL. Thus, investors are still hesitant to bet on a genuine rebound. Three key factors will determine whether Solana can reverse the trend and reach its historical peaks.

Solana Under Pressure : A Critical Decrease in Activity

Solana, long perceived as one of Ethereum’s most serious challengers, is going through a critical slowdown. Indeed, its on-chain activity has contracted by 40 % in one week, a decline much more pronounced than that observed on BNB Chain (-1 %) and Ethereum (-10 %). This drop in activity has particularly affected several major protocols. Meteora has seen its volumes collapse by 45 %, Orca by 62 %, and Lifinity by 53 %.

This setback reflects a loss of momentum for Solana, which has established itself in recent months as a favored ground for decentralized applications. Fewer trades on the network means lower liquidity and reduced economic activity, which can hinder the adoption of new projects and weaken the protocol’s appeal against its competitors.

However, this malaise does not affect the entire ecosystem. Some platforms continue to attract users. Pump.fun, specializing in launching memecoins, shows a 24 % increase over the same period. Raydium, the ecosystem’s main DEX, maintains its leadership with a weekly volume of $35.1 billion. This contrast highlights a paradoxical phenomenon: while overall activity is declining, certain specific segments remain dynamic, particularly those related to speculative assets like memecoins.

This fragmentation poses a key question: Can Solana rely on these pockets of resilience to sustainably boost its attractiveness, or are these isolated successes insufficient to reverse the overall trend?

A Still Fragile Rebound : A Lack of Investor Conviction

Despite the decrease in on-chain activity, a key indicator suggests that Solana retains a certain attractiveness. The Total Value Locked (TVL) has surged by 27 % in a month, and far surpasses Ethereum, which is down 9 %, and BNB Chain, which has only lost 1 %. This strengthening of the TVL indicates increased confidence in the network’s infrastructure, particularly in the areas of staking and decentralized finance (DeFi). Jito and Raydium recorded a 29 % increase in their deposits, while Binance Staked SOL increased by 52 %. This influx of capital suggests a beginning of stabilization following the recent market correction.

However, this improvement is not enough to reassure all investors. The derivatives market shows measured enthusiasm. The premium on SOL futures contracts, which reflects investor confidence in long-term price increases, briefly reached 12 % before falling back to 6 %. This retreat indicates sustained caution, especially given that the recent rise in SOL’s price (+21 % over a month) seems mainly driven by speculation around memecoins and the launch of the “Trump” token. This phenomenon raises questions about the solidity of this recovery.

For SOL to regain its highs, three key factors need to come into play. First, the migration of stablecoins from Tron to Solana could generate increased demand for the token by strengthening the ecosystem’s liquidity. Secondly, the rise of Web3 applications and the integration of artificial intelligence into the network could provide it with strategic positioning in the long term. Finally, institutional investor confidence must be restored. This will require tangible proof of the network’s resilience, particularly through greater adoption among large companies and a resurgence of volumes on decentralized platforms.

Thus, Solana stands at a decisive crossroads. While its TVL and interest in staking show positive momentum, institutional investor engagement remains fragile. The blockchain must now prove that its rise to power is based on solid foundations, not fleeting trends.

In the short term, Solana sends contradictory signals. On one hand, its ecosystem is strengthening, supported by an increase in Total Value Locked and growing interest in staking. On the other hand, the market remains cautious, hindered by declining on-chain activity and enthusiasm still too focused on speculation. To hope to reconnect with its historical peaks, Solana must demonstrate that its rebound rests on solid foundations and attract more institutional investors by consolidating its adoption in Web3. The potential is there, but the trajectory remains uncertain.