Recently, the Solana network has exhibited signs of recovery and growth, indicating an upswing in ecosystem activity. Data from Messari reveals that weekly active addresses on Solana have doubled since December 2022, signaling a resurgence in network participation. This increase is particularly significant following a period of over a year with relatively low activity on Solana addresses.

A pivotal aspect of this uptick in activity is linked to the decentralized finance (DeFi) sector on SOL. DeFi activity is experiencing a notable surge, partly driven by airdrop announcements. Since early November, the Total Value Locked (TVL) on SOL has increased by approximately 47%, currently reaching $1.19 billion. However, it’s crucial to note that Solana’s DeFi sector is still 89% below its peak, recorded two years ago with a TVL close to $10 billion.

1/ Solana’s ecosystem has seen exceptional growth lately:

+ SOL up over 6x from Dec ’22 lows
+ active addresses up ~2x
+ TVL up ~2x

But, do these figures reflect fundamental growth, or is there a disconnect between price action and network development? pic.twitter.com/MRgFCLlQAP

— Ally Zach (@0xallyzach) December 6, 2023

Solana, initially positioned as a new hub for DeFi upon its launch, has undergone diversification over time. New infrastructures and tools, such as compressed NFTs, have given rise to the development of new applications for platform users.

Solana Has a Long Way to Go

Despite these positive developments, Solana faces challenges on its path to full recovery. While the DeFi sector shows clear signs of improvement, it remains significantly below previous peak levels. Additionally, SOL lags behind the total TVL in the DeFi space, which experienced a decline of approximately 74% from its all-time high.

The price of the SOL token, despite showing improvement in recent weeks, still remains significantly below its all-time high. While it has outperformed Bitcoin in the last month, some analysts predict a pullback.

According to the latest data published by CoinMarketCap, SOL is trading at $61.11 per unit after a 1.35% decline in the last 24 hours. Its market capitalization has experienced a similar drop and is around $28.9 billion, while its trading volume has plummeted by 26%, standing at just over $2 billion.

The Solana network displays encouraging signs of recovery with an uptick in activity, particularly in the DeFi sector. However, challenges persist, and the network has a significant journey ahead before reaching pre-collapse levels.

---

Filed under: News - @ December 7, 2023 11:19 am