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In the race for programmable layer-1 dominance, Solana (SOL) has featured high in the rankings lately. As reported earlier, Solana has even toppled Ethereum (ETH) on many occasions in relation to its decentralized exchange (DEX) volume. As recently highlighted by market analyst @WazzCrypto on X, about 92% of the Solana DEX volume comes from meme coin trading.
Solana suffered from meme coin hype
Meme coins are now a sensation in the digital currency ecosystem. In the top 20 of the most capitalized digital currencies, two meme coins are featured, including Dogecoin (DOGE) and Shiba Inu (SHIB). While these two dominate the meme coin scene, Solana-based variants like BONK and dogwifhat (WIF) are also major tokens to reckon with.
Notably, BONK and WIF are established on the market, but judging by its lower fees and high throughput, Solana has recorded a massive influx of new meme coins over the past year. This influx has done a lot of harm to Solana as it has helped in fee generation.
One major limitation that pushed some innovators out of the Ethereum ecosystem in search of new alternatives is its congestion woes. The first quarter of this year was challenging for Solana with the explosive meme coin market.
With dedication and the right push, Solana developers finally launched a major fix on the mainnet. It is, however, worth noting that reliance
Can Solana compare to Ethereum?
Per the data shared by Wazz, the dominance share of meme coins on Solana grew from 25% in November 2023 to the 90% seen today. This is a major leap in an extremely large unpredictable asset class.
High-profile decentralized finance (DeFi) applications like Jito and Marinade Finance are contributing the bulk of the transactions on Solana, so it remains unsustainable. Ethereum, on the other hand, had its underlying spot ETF approved in the U.S. As the race for dominance heats up, Solana’s catchup strategy needs to decouple from meme coins for longer-term sustainability.
