Solana’s native token, SOL, experienced a 6% decline, falling from a high near $172 on Monday. This drop closely mirrored a broader pullback in the Nasdaq Index, which was influenced by factors such as CoreWeave’s reduced cloud services revenue forecast and reports of China potentially banning US military access to its rare-earth minerals. The question remains whether SOL can reclaim the $250 level in the near future.
Over the past two weeks, SOL has underperformed the altcoin market by 7% without a definitive catalyst for this downturn. The surrounding environment has been generally positive, highlighted by the launch of a Solana spot exchange-traded fund (ETF) in the US and a significant increase in Solana's on-chain activity.
Network Activity and DApp Revenue Dominance
Solana's network activity has seen a substantial surge in the last 30 days, with active addresses increasing by 10% and transactions rising by 8%. In comparison, Ethereum experienced a 5% decrease in active addresses and a 26% drop in transactions during the same period. Hyperliquid, a notable player in the decentralized exchange (DEX) space, also saw a 28% decline in its on-chain activity.
Solana continues to lead in decentralized applications (DApps) revenue, maintaining a dominant position that no other network approaches. This sustained revenue generation provides Solana with a competitive advantage, as DApps often reward users with yield from their earnings, attracting more deposits and strengthening the network's standing.
Diversified Growth Across Multiple Sectors
The total value locked (TVL) on Solana currently stands at $12 billion, surpassing BNB Chain, which holds $8 billion. In the past 30 days, several projects have demonstrated significant growth, including Securitize (Real World Assets) with a 35% increase, Solstice USX (Basis Trading) with a 31% rise, and Meteora (Liquidity Pools) with a 10% uptick in deposits. This data indicates that Solana's growth is becoming more diversified and less dependent on any single sector.
While memecoin launches and trading activity were once the primary drivers of Solana's user growth and network fees, this trend began to fade by March. Although the token has recovered from its 2025 low of $95, traders remain cautious about its short-term upward potential.
Since their introduction to US markets on October 28, spot Solana ETFs have attracted $343 million in net inflows. Additionally, the REX-Osprey SOL + Staking ETF has accumulated an additional $286 million in assets. However, the overall positive impact of these instruments has been partially counteracted by outflows from entities reducing their SOL holdings.
The sale of 439,621 SOL by Galaxy Digital Holdings has raised questions regarding the sustainability of Solana’s corporate reserve strategy. Forward Industries holds the largest position, with 6.82 million SOL, a figure that has remained consistent over the past 30 days, according to CoinGecko data.
Outlook for SOL
The indicators still suggest that SOL is poised to outperform the broader altcoin market, supported by Solana's consistent growth in on-chain activity and its leading position in DApps revenue. Nevertheless, the path to reaching $250 is likely to be influenced by a reduction in risks associated with the artificial intelligence sector and a de-escalation of geopolitical tensions related to the ongoing global trade war.