The Solana ecosystem continues to heat up, and the multi-pronged approach of meme coins, inscriptions, and NFTs has made the crypto market realize that the "Ethereum killer" that was once considered the most likely is back?
Yesterday, Solana's meme coin project SILLY expanded its 24-hour rise to 211%, COQ, WIF and other meme coins also once appeared on the trading hot list, with an astonishing increase, and Solana's native token SOL also briefly broke through $84 earlier today, up 11% in 24 hours.
Before that, the first to be hit was Bonk, a meme coin that saved Solana from fire and water. As the price of Bonk has risen, Solana Labs' Web3 phone Saga has also received a huge premium in the secondary market, as each Saga phone is entitled to an airdrop of up to 30 million BONK tokens. A few days ago, Kyle Samani, co-founder of Multicoin Capital, said on the social platform that Solana mobile Saga owners are expected to receive a large number of airdrop events in the next 12 months. It's also a great addition to Solana's meme season.
On December 16, the DEX trading volume on the Solana network was about $1.475 billion, surpassing the Ethereum network (about $1.164 billion), and the trading volume reached $6.429 billion in the past week, an increase of 52.75%. Today, less than a week later, the single-day trading volume of the DEX on Solana surpassed Ethereum for the second time in history, with a daily trading volume of more than $1.2 billion.
Analysts believe that the trend of Solana gaining market share as the new crypto trading hub could continue by providing a better user experience through low-cost fees and faster transactions, coupled with the recent wealth effect in the ecosystem. And that's exactly what Solana co-founder Anatoly's huge vision is to completely rebuild the New York Stock Exchange or NASDAQ on-chain.
"On-chain NASDAQ"
Solana's origins can be traced back to the rise of cryptocurrencies in 2017, which created a wealth myth but also caused congestion on the blockchain network. Anatoly, an engineer who has worked at Qualcomm for several years, realized that blockchain and communication networks faced similar problems and that there might be common solutions. One of Solana's goals is to compete for a share of traditional finance.
Solana's path to solving the blockchain's impossible triangle is to confirm the time it takes for a transaction through Proof of History, partially sacrificing decentralization for speed, but "fast speed, low cost, and low friction in user interaction" have also become Solana's signature. Solana TPS has a theoretical extreme value of 710,000, surpassing visa's 17,000.
In July 2020, Solana ushered in its first major turning point, when FTX announced that it would build its DEX Serum on top of Solana, which was the beginning of SBF's partnership with Solana. SBF's need for on-chain support for high-frequency trading public chains is in line with Solana's mission to build an on-chain NASDAQ.
Since then, SBF has not only publicly supported Solana, but also participated in multiple rounds of funding for Solana, and has also invested in several Solana-based applications since then. With the blessing of FTX, Solana quickly gained a foothold in the crypto world, and star VCs such as Multicoin Capital, a16z, and Polychain Capital have invested in Solana, and the return rate is also quite impressive, and Solana is even called the VC chain.
But with the advent of cyclical bottoms and the collapse of the FTX empire, Solana has also experienced its biggest existential crisis since its inception. However, as the market has become more active and the volume of transactions has increased significantly, Solana's strengths have been re-emphasized.
On October 31, the Solana Foundation announced the official testnet launch of Solana's second node validator, Firedancer, developed by Jump Crypto, at Breakpoint, the annual summit of the Solana community, and its mainnet is expected to launch in the first half of 2024.
Firedancer is used to increase the diversity of node clients and the stability of the Solana blockchain, and to make Solana more resilient and attack-resistant. Firedancer was developed in C/C++ compared to the first client, which made it more compatible and memory efficient, while reducing the cost of running a Solana node.
Today, Kyle Samani, co-founder of Multicoin Capital, reassured the market by mentioning that Firedancer will be 200 times more efficient at receiving and interpreting trades in real-time.
Currently, Solana has 2,373 TPS and an average transaction fee of $0.00025, which is still ahead of Solana in terms of price/performance relative to Ethereum's 14.8TPS and $1.66 Gas. Under the inscription trading boom, Solana's transaction fees have not increased much compared with before, but the transaction fees of public chains such as Bitcoin, Ethereum, and Avalanche have risen during this period, which was once "daunting".
"Ethereum Killer"
High transaction throughput has always been one of the core needs of cryptocurrency, which is why Ethereum has undergone several major upgrades. Looking back at Solana's development this year, its "on-chain NASDAQ" vision is moving forward step by step, and the familiar name of "Ethereum killer" has once again been named Solana.
Jademont, founding partner of Waterdrip Capital, posted on X today that Solana's sudden rise has made holders shout "Solana Flip ETH", and he believes that "Ethereum's L2 is a stopgap measure in the case of a layer 1 scaling technology." In other words, if Ethereum can't achieve a breakthrough in layer 1 scaling in this cycle, then there is Solana in front of it, and then there are various BTC L2s, which is a bit difficult. 」
In yesterday's release of CRYPTO THESES 2024, Messari wrote, "When I think about Ethereum vs. Solana, I think of Visa vs. Mastercard, not Google vs. Bing. 」
Crypto trader @MoonOverlord wrote on X, "Obviously bullish on SOL, thinking it would outperform, but didn't expect ETH to be so pathetic, barely hitting new highs in the last two years, brutally. According to CoinGecko data, SOL has risen by 587.4% over the past year, while ETH has risen by only 81.7% over the past year.
On October 28, asset management firm VanEck released a report saying that its application of VanEchk's standardized valuation framework to Solana showed that SOL could basically achieve a single token value of $335 in 2030. Despite its great potential, VanEck believes that the likelihood of Solana hosting most of the world's cryptocurrency transactions by 2030 is still lower than that of Ethereum. If Solana can avoid the Ethereum narrative and achieve Ethereum-like dominance, VanEck's bull market analysis framework shows that the Solana network will reach $51.8 billion in revenue by 2030, with a SOL price target of $3,211.
Solana's performance is well documented, and next year's Firedancer upgrade promises to increase the capacity of the Solana network by another 10x, and the upgraded Solana network can achieve nearly 1,000 times the throughput of Ethereum 2.0. However, the upcoming Cancun upgrade of Ethereum in 2024 also makes it even more exciting to see how the crypto market landscape will change next year.