The Solana ecosystem continues to grow and evolve, but it has a long way to go to catch up with Ethereum. Nevertheless, activity on Solana has been steadily increasing in numbers, which is a good starting point.

Weekly active addresses on Solana have reached pre-FTX collapse levels, according to data from Messari.

Solana Activity Resurgence

On December 6, Messari researcher Ally Zach reported that weekly active addresses on Solana have doubled since December 2022.

After more than a year in the doldrums, Solana’s address activity finally started to tick up in October.

Solana weekly active addresses. Source: X/@0xallyzach

Solana was initially poised as a new DeFi hub when it launched. However, it has diversified over time, she noted before adding:

“New infra and tooling such as compressed NFTs have yielded new consumer apps on the platform.”

Nevertheless, DeFi activity has also started to increase, driven by airdrop announcements. Since the beginning of November, Solana TVL has increased by around 47%, according to DefilLama. It is currently $1.19 billion, which is also back to pre-FTX collapse levels.

Read more: How To Buy Solana (SOL) And Everything You Need To Know

Zach noted that new token launches boost market caps and decentralize exchange TVL. This, in turn, draws in users via the trading potential of these tokens.

Nevertheless, it is not all bullish news for the Solana ecosystem. While DeFi is recovering, it is still down 89% from its peak of almost $10 billion TVL two years ago. Moreover, Solana is lagging behind total DeFi TVL, which is down around 74% from ATH comparatively.

Zach also noted that despite an increase in consumer-based apps in the past year, user activity has dwindled from the peak in June.

Additionally, NFT trading volume on the platform has remained relatively flat since September and is way down from peak levels.

The analyst concluded the latest set of users on Solana is a mix of newcomers and veterans and not airdrop farmers.

“This change indicates a potential for these users to become long-standing contributors, thereby reinforcing Solana’s sustainability.”

SOL Price Outlook

Solana token prices have performed much better than the network itself in recent weeks. However, it should be noted that SOL was obliterated following the collapse of FTX due to its ties with the firm, so these gains are relative.

SOL is currently trading at $62.89, down 2.37% on the day.

SOL/USD 1 week. Source: BeInCrypto

Nevertheless, the token has made 55% over the past month, outperforming even Bitcoin. Analysts are predicting a pullback, however.

Like most altcoins, SOL remains down 76% from its all-time high, so there is still a long way to go.

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The post Solana DeFi & Network Activity Increasing But Road to Recovery Is Long appeared first on Crypto News Australia.

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Filed under: Bitcoin - @ December 7, 2023 5:23 am