Yesterday, October 28, 2024, Solana, for the first time, generated more daily fees than Ethereum. This reversal highlights Solana's growing appeal to crypto users, who favor fast, low-cost transactions in an industry where efficiency is increasingly valued. Ethereum has long dominated as the benchmark for decentralized applications and smart contracts, so this overtaking symbolizes the rise of new options that challenge its status.
The rise of Solana over 24 hours
On October 28, 2024, Solana reached a major milestone and surpassed Ethereum in fees generated in a single day, with over $2.54 million, compared to Ethereum's $2.07 million, according to data from DefiLlama. This feat is mainly based on the increase in transactions on Raydium, the most used decentralized exchange (DEX) on the Solana network, which itself generated $3.41 million in fees during the same period. Solana has always relied on a monolithic scaling approach to maximize transaction throughput and minimize costs, without the need for second-layer solutions like Ethereum.
This dramatic increase in fees is a key indicator of growing usage of the Solana network. Indeed, the platform attracts more and more users looking for fast and low-cost transactions, where Ethereum is often criticized for its high fees and its dependence on Layer 2 solutions to improve its scalability. However, in the long term, Ethereum retains a central place in the ecosystem, in particular thanks to the diversity of its decentralized applications (dApps) and its status as a dominant protocol.
Long-term domination of Ethereum
Despite this remarkable performance of Solana over a 24-hour period, Ethereum remains, in the long term, the main protocol in terms of fees generated. Over the past 30 days, Ethereum has accumulated nearly $134.6 million in fees, well above the $61.3 million generated by Solana. Over a longer period, Ethereum still demonstrates superiority in terms of fees and user activity, which underlines its leading position despite scalability challenges. This supremacy is largely explained by the fact that Ethereum remains the reference blockchain for smart contracts and decentralized applications, which thus attracts more solid and diversified projects.
Furthermore, a significant part of Solana's revenue comes from more speculative activities, such as the memecoin market. Indeed, nearly 47% of Solana's monthly fees, or approximately $29.5 million, were generated via the Pump.fun platform, a service linked to the launch of memecoins. If this demonstrates a certain excitement around Solana, it calls into question the sustainability of this trend. In comparison, Ethereum benefits from a more mature and diverse ecosystem, which protects it from sudden fluctuations linked to more speculative markets.
The rise of Solana and its occasional overtaking of Ethereum in terms of fees highlight the emergence of new dynamics in the crypto ecosystem. However, Ethereum remains ahead in the long term thanks to the robustness and diversity of its network. Solana, with its ability to attract users through fast transactions and low fees, could continue to play a key role in the battle for supremacy, but challenges remain to the sustainability of this model.
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