The Solana (SOL) network has witnessed a remarkable surge in its monthly active addresses, reaching 138 million this month. This dramatic rise, which was spurred by the wider cryptocurrency market recovery, shows an exponential growth from the 13.8 million active addresses recorded at the beginning of the year.
Artemis data reveals a gradual increase in active addresses on the Solana network throughout the year, with the figure skyrocketing from around 40 million in August to over 100 million in early October. In the past month alone, the figure has grown by over 30%.
This increase in monthly active addresses coincides with a boom in the total value locked (TVL) on Solana’s decentralized finance ecosystem. Substantial inflows have been recorded throughout the year, with $2.36 billion of these funds migrating from Ethereum. Despite this, Ethereum saw an inflow of $1 billion from these funds.
In the context of Ethereum’s TVL, only 2.7% migrated to Solana throughout the year. The second-largest network by market capitalization experienced $6 billion of net outflows this year.
Despite these outflows, Solana’s ascent this year has been noteworthy. Its price has significantly outpaced most other digital assets to the point where it is on the cusp of overtaking Binance’s BNB to become the fourth-largest digital currency by market capitalization.
However, Solana’s ecosystem faced a significant setback with the collapse of FTX in November 2022. The exchange’s executives, known to be ardent Solana proponents with large SOL holdings, were implicated in the collapse, which resulted in a nearly 70% price drop for Solana amid larger market panic.
The collapse of FTX sparked concerns about the long-term sustainability of the Solana ecosystem. It was estimated that approximately 20% of Solana-based projects had received investments from FTX or its sister company, Alameda Research.
Despite these challenges, investors have reengaged with the Solana ecosystem. Projects such as Pump.fun and the decentralized cryptocurrency exchange Raydium have seen their activity levels soar in recent months, as reported by The Block.
With its exponential growth and resilience in the face of challenges, the Solana ecosystem continues to provide an intriguing landscape for investors and users alike. Its robust performance in the past year underscores its potential to outshine other digital currencies and dominate the decentralized finance ecosystem.
As the cryptocurrency market continues its recovery, all eyes will undoubtedly remain on Solana’s impressive growth trajectory.
