Solana’s (SOL) decentralized finance (DeFi) business has gained significant momentum, with its decentralized exchanges (DEX) surpassing Ethereum (ETH) DEX in monthly trading volume. So far in November, Solana-based DEXs have seen over $100 billion in trading volume, marking a major milestone for the ecosystem.
Solana DeFi Ecosystem Gains Momentum, Surpasses Ethereum DeFi
Solana, the fourth largest cryptocurrency with a reported market capitalization of $118.34 billion, has been on a record price trajectory. Recently, the digital asset hit a new all-time high (ATH) of $263 after hitting a low of $8 during the height of the FTX fiasco.
Today, Layer 1 blockchain reached another milestone as Solana-based DEXs surpassed $100 billion in monthly trading volume for the first time. According to data from DefiLlama, the 30-day cumulative trading volume recorded by Solana DEX stands at $116.51 billion.
In comparison, DEXs based on the Ethereum mainnet saw a trading volume of $61.61 billion during the same period. This means that Solana’s DEX trading volume was more than double that of Ethereum.
On a month-on-month (MoM) basis, Solana’s DEX volume jumped over 100% from October, which stood at $52.5 billion. Meanwhile, the total value locked (TVL) in Solana’s DeFi ecosystem increased to $9.30 billion, up from $6.23 billion a month ago.
The unprecedented increase in Solana-based DEX trading volume can be attributed to several factors. These include the current memecoin frenzy, low blockchain transaction fees, and an intuitive user interface.
It is worth pointing out that Solana’s TVL has yet to surpass its ATH TVL of $10.02 billion, recorded almost three years ago in November 2021. As of January 2023, the blockchain’s TVL reached a minimum of $210 million, dragged down by the broader crypto bear. market exacerbated by the fall of the FTX stock market.
At the time of writing, $3.58 billion of Solana’s TVL is tied to liquid staking protocol Jito, while Jupiter DEX holds $2.4 billion. Raydium, another major Solana-based DEX, accounts for $2.37 billion in TVL.
Where is SOL going?
Solana’s growing user adoption has played a crucial role in the recovery of its native token, SOL. Year-to-date (YTD), SOL has gained over 157%, from $101 on January 1st to $263 on November 23rd.
Despite these extraordinary returns, crypto experts remain bullish on SOL, expecting further gains for the digital asset. According to a recent analysis by Titan of Crypto, SOL could reach $400 as it appears to be breaking out of an extended cup and handle pattern.
Additional bullish factors, such as the decline of Bitcoin (BTC) dominance and the growing likelihood of a Solana exchange-traded fund (ETF), could further propel SOL to new highs. SOL is trading at $248.31 at press time, up 0.5% in the last 24 hours.
