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Solana has outperformed Ethereum in total transaction fees and Maximum Extractable Value (MEV) tips for the first time on a weekly basis.
The Layer 1 blockchain's fee revenue of $25 million eclipsed Ethereum's $21 million, signaling a significant shift in network activity, according to Blockworks Research analyst Dan Smith. The network's daily fee revenue also peaked at $5.5 million on July 28th, marking a three-month high, with Smith noting that 58% of this revenue came from MEV tips, with priority transaction fees accounting for 37%.
For the first time ever, Solana surpassed Ethereum in total transaction fees and MEV tips on the weekly timeframe ($25M vs $21M)
— Dan Smith (@smyyguy) July 29, 2024
Solana validators and stakers are absolutely eating this cycle pic.twitter.com/kIIKVLUDPr
This milestone underscores Solana's robust network activity and the increasing popularity of its decentralized applications (DApps). A surge in activity within Solana's network, particularly around memecoin trading platforms like Pump.fun and Moonshot, has significantly boosted its market presence. The memecoin frenzy, which started with tokens like Bonk, has evolved into a cultural phenomenon, driving transaction volumes and user engagement on the Solana network.
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Earlier this week, Solana surpassing Binance Coin (BNB) to become the fourth-largest cryptocurrency by market capitalization, which has reached a new all-time high of 3.67%. Its price trajectory is equally impressive, soaring from a modest $25 just a year ago to its current position, hovering around $185.
Despite Solana's recent achievements, Ethereum remains the leader in total value locked (TVL), holding nearly $60 billion compared to Solana's $5.5 billion. This disparity highlights the ongoing challenge for Solana to close the gap with Ethereum, despite its faster network speeds and lower gas fees. While Ethereum's first-mover advantage in the smart contract industry is significant, Solana's rapid growth and increasing adoption could position it as a formidable competitor.
In May, VanEck and 21Shares filed applications for a Solana exchange-traded fund (ETF) in the United States, triggering an 11% increase in the price SOL. "This development, regardless of its eventual outcome, is seen as a promising step that could bring more institutional interest and investment into Solana," BRN lead analyst Valentin Fournier said at the time.
Fournier added that "With its transaction speed, scalability and cost-efficiency, Solana is a serious contender for an increasing market share in a growing market," citing better total fees/market cap ratio than Ethereum, stronger user growth compared to Ethereum, and high liquidity and high demand for SOL.
Last month, the Solana Foundation announced the release of "Actions" and "Blinks," designed to streamline crypto transactions across various platforms. Solana Actions empowers developers to integrate blockchain transactions directly into websites, social media, and even physical QR codes. This eliminates the complexities often associated with interacting with Web3 platforms, potentially paving the way for broader adoption.
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