Key takeaways:
Solana ETFs and ETPs saw $706 million in weekly inflows, surpassing XRP’s $219 million, according to CoinShares.
SOL funding rates remained under the 6% neutral threshold, indicating a lower interest in leveraged bullish trades among investors.
Solana’s native token, SOL, rebounded to $229 on Tuesday after briefly touching $218. This rise followed positive investor reactions to the US Federal Reserve’s minutes from its Sept. 17 meeting, which reinforced expectations for interest rate cuts in 2025.
Optimism among traders persists, believing SOL may hit the $300 level, a goal that seems achievable given the robust bullish sentiment reflected in derivatives metrics and on-chain data.
Solana experienced a 22% rise in seven-day network fees due to increased activity on decentralized exchanges (DEXs), while Ethereum, its primary competitor, saw a 21% decrease in network revenue during the same timeframe. Solana continues to lead in transaction counts, surpassing the combined totals of Ethereum and its layer-2 ecosystem.
DEX activity on Pump surged by 78% over the last week, with Meteora rising 73% and Raydium increasing by 46%. Solana reclaimed its leading role in decentralized exchange transactions, achieving $129 billion in 30-day volume, outpacing Ethereum’s $114 billion, per DefiLlama data. Meanwhile, the swiftly growing competitor, Hyperliquid, has stagnated around $31 billion.
Solana network activity escalates
Network fees are critical for any blockchain focused on decentralized applications, especially as the revenue helps mitigate inflationary pressures. Maintaining validators incurs costs unless centralized, and staking participants anticipate reasonable returns. Thus, low network activity may deter holding the native token, potentially leading to sell pressure.
Solana’s total value locked (TVL) rose 8% in the past month, bolstering further growth in network fees. Key performers included a 20% jump in Kamino deposits, 12% in Drift, and 12% in Orca. In comparison, Ethereum’s TVL grew by 3% in the same period, while Tron deposits rose by 6%. Consequently, Solana has solidified its position as the second-largest network, boasting $14.2 billion in TVL, representing an 8% market share.
The rapid activity increase on the perpetual futures trading platform Aster has shifted traders’ focus toward BNB Chain, spurred by a wave of memecoins that surged by over 150% within a week. Although SOL’s price increased by 3% during this period, BNB’s significant 28% climb affected sentiment among Solana ecosystem investors.
Increasing inflows to SOL ETPs indicate rising institutional interest
Insights from SOL perpetual futures highlight potential loss of trader confidence after the unsuccessful attempt to exceed $250 on Sept. 18. Many SOL holders may feel disheartened, particularly as some rival tokens have recently reached new all-time highs, including BNB at $1,357 on Tuesday and Mantle (MNT) at $2.81 on Wednesday.
The funding rate on SOL perpetual futures has persisted below the 6% neutral level, suggesting weak demand for bullish leveraged positions. This cautious outlook among traders could be partly influenced by the escalating popularity of competing blockchains, which have diverted attention from Solana, despite record weekly inflows into its exchange-traded products.
CoinShares reported that Solana ETFs and ETPs attracted $706 million in inflows during the week ending Sept. 5, greatly exceeding the $219 million recorded by XRP instruments. Investors are now anticipating that the US Securities and Exchange Commission will approve multiple spot Solana ETFs on Friday, a development likely to drive further institutional inflows and may help push SOL’s price beyond $300.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
