What is the Reason Behind the Hype of Solana’s Tremendous Surge in Q1 2024?

In 2022, Solana faced speculation due to the FTX collapse and SBF BFF drama, resulting in a drop in value starting from November 2021. However, in 2024, Solana’s ecosystem is once again expanding beyond its previous limits as the overall crypto bull run gains momentum leading up to the Bitcoin halving event.

So, what exactly is Solana? It is a high-speed blockchain that supports smart contracts, DApps, and NFTs. In comparison to networks like Ethereum, Solana’s transactions are fast and low-cost. The native token of the Solana blockchain is SOL. As of 2024, Solana has minted almost 192 million NFTs, making it one of the top NFT blockchains.

The founder of Solana, Anatoly Yakovenko, created the Proof of History consensus mechanism, allowing the blockchain to achieve a TPS (transactions per second) of up to 65,000, all at a fraction of a cent.

When comparing the number of active developers, Solana comes second after Ethereum in 2023. Ethereum also captures 12.7% of investor interest, ranking as the second most popular blockchain space in 2024. Additionally, Ethereum layer 2s account for 11.9% of investor interest, with Arbitrum and Base ecosystems being the most popular among them.

Solana’s architecture is designed for speed and efficiency, utilizing the unique Proof of History with Proof of Stake consensus mechanism to achieve high throughput. The network supports various applications, from DeFi to NFTs, making it a popular choice for developers seeking scalability and users looking for affordable and reliable transactions.

Now let’s take a look at the state of the Solana ecosystem and its explosive growth in Q1 of 2024. On March 18, 2024, Solana experienced a significant surge, surpassing the $200 mark for the first time in two years and reaching its highest price since 2021. This surge was fueled by a notable increase in network trading volume.

Over the past 12 months, SOL’s price has grown by 700%. As a layer 1 blockchain, Solana captures 49.3% of global crypto investor interest in chain-specific spaces. On March 15, 2024, despite the broader market downturn, Solana achieved a major milestone by surging 11% and reaching a new all-time high market capitalization of $82.5 billion.

Solana’s recent activity has been prominent on decentralized exchanges (DEXs) like Jupiter and Raydium, where traders actively accumulate memecoins such as Bonk and Slerf. Solana-based DEXs have been steadily gaining market share from Ethereum DEXs like Uniswap for the past four months.

In the last week, Solana has seen a remarkable surge in on-chain volumes, accompanied by a notable increase in network fees collected. According to data from DefiLlama, daily transaction fees on Solana have consistently increased since the beginning of March 2024. On March 18, 2024, the total transaction fees paid on Solana reached a groundbreaking record of $5.08 million.

As of now, the current price of Solana stands at $189.49, with a market capitalization of $84.19 billion USD. The percentage staked is 65.37%, and the estimated reward rate APY on staking is 5.01%.

The Solana ecosystem continues to thrive with new developments. Here is a list of the top Solana-based stablecoins by market cap: Tether ($778.66 million), USDC ($2.033 billion), UXD ($7.46 million), Dai ($662,012), and Parrot USD ($5.23 million).

Solana-based memecoins have performed exceptionally well in Q1 of 2024. Some notable ones include Dogwifhat ($3.09 billion market cap), Bonk ($1.5 billion market cap), Book of meme ($708.37 million market cap), Slerf ($379,915,136 market cap), and Popcat ($296,767,516 market cap).

In the NFT world, Solana is gaining ground over Ethereum due to platforms like Solanart and Magic Eden, offering low fees and fast processing times. The top Solana-based NFT collections in Q1 of 2024 include Famous Fox Federation ($9.13 million collection value), Okay Bears ($9.82 million collection value), SMB Gen2 ($36.93 million collection value), Nyan Heroes ($4.96 million collection value), and GGSG ($29.9 million collection value).

Over the past 10 months, Solana has proven to be a commendable performer, with its price surging by 10x. Its resilience and survival in a challenging crypto market can be attributed to factors such as a vibrant developer community, a growing DeFi landscape, and a thriving NFT sector.

In March 2024, Solana demonstrated exceptional resilience and efficiency when handling a surge in network activity during the Jupiter airdrop. Despite some users experiencing transaction delays, the network’s overall performance remained impressive. Solana processed 1 billion in DeFi trading volume within three hours and managed 2.5 million non-vote transactions over 2.5 hours. Although the transactions per second momentarily dipped, the network quickly recovered, ensuring no validators failed and no transactions were lost.

This event showcased Solana’s immovable architecture and its potential to revolutionize the blockchain space. The achievement of 1 billion DeFi trading volume in a short time is a testament to Solana’s scalability and its active role in bridging the gap to traditional finance.

Overall, the crypto industry, with Solana at the forefront, is evolving steadily in Q1 of 2024.