The post From 97% to 70% Discount — Analyzing Key Metrics in 2023-2024 appeared on BitcoinEthereumNews.com.

Solana (SOL) was trading at 97% discount to the market capitalization of Ethereum’s ether (ETH) in January 2023 — a clear market dislocation that has closed significantly over the last two years. Today, the discount has shrunk to 70%. However, Solana is starting to challenge Ethereum in terms of on-chain activity and key measures of network usage. Which raises the question: Is the market still dislocated? In this short piece, we explore this key question with relative analysis across four key data points. Let’s dive in. 1. Network Fees Data: Artemis, The DeFi Report, Gas Fees Only (does not include MEV). Please note that we’ve included the following L2s in the comps data: Arbitrum, Base, Optimism, Blast, Celo, Linea, Mantle, Scroll, Starknet, zkSync, Immutable, and Manta Pacific. Layer 2s create new demand for block space on the Ethereum layer 1 and increase the network effects of ETH the asset. Therefore, we include them in our comparatrive analysis for SOL. In the second quarter, Solana did $151 million in fees, which is 27% of Ethereum plus its top layer 2s. Fast forward to the last 90 days and the ratio has jumped to 49%. 2. DEX Volumes Data: Artemis, The DeFi Report Solana did $108 billion in decentralized exchange, or DEX, trading volume in the second quarter, or 36% of Ethereum and its top L2s. Over the last 90 days, Solana is up to $153 billion and 57%, respectively. 3. Stablecoin Volumes Data: Artemis, The DeFi Report Solana did $4.7 trillion in stablecoin volume in the second quarter: 1.9 times Ether and the top L2s. Over the last 90 days, solana did $963 billion of volume: 30% of ether and the top L2s. Why the drop? We think this is mostly due to bots/algorithmic trading that were juicing the numbers in…

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Filed under: News - @ November 27, 2024 8:22 pm