Sol Struggles As Solana Tvl Slides And Memecoin Demand Fades

SOL demand cools as its total value locked drops by $10 billion and memecoin trading slumps. Traders’ lack of appetite for long leverage could further complicate the situation.

SOL funding rates signal low bullish conviction after a 46% price drop, despite Firedancer’s launch and rising Solana network transactions.

Solana DApp revenues and DEX activity have weakened sharply, suggesting broader market fatigue even as Solana’s ecosystem grows.

Solana’s native token, SOL (SOL), has failed to sustain prices above $145 for the past four weeks. A decline in network activity amid reduced demand for decentralized applications has negatively impacted SOL’s outlook.

With Solana’s TVL now down more than $10 billion from its September peak, onchain metrics are flashing signs that user participation is cooling faster than expected.

The total value locked (TVL) on Solana has been in decline since reaching its all-time high of $15 billion in September. Falling smart contract deposits increase the immediately available SOL supply for sale. Meanwhile, revenues from decentralized applications (DApps) on Solana dropped to $26 million per week, down from $37 million two months earlier.

Traders’ appetite for memecoins has also weakened since the cryptocurrency market flash crash on Oct. 10, an event that exposed critical flaws in leveraged positions and the overall liquidity of smaller altcoins. Regardless of whether derivatives markets amplified the move, traders became less comfortable with DEX platforms following the $19 billion liquidation event.

Memecoins have been a major driver for SOL, especially after the Official Trump (TRUMP) launch in January, which pushed decentralized exchange (DEX) volumes on Solana to $313.3 billion that month. According to DefiLlama data, this activity has since dropped by 67%, partly explaining the softer revenue trends across Solana DApps.

Still, the reduced demand for blockchain-based applications may reflect a broader market slowdown rather than a specific weakness in Solana.

Solana network fees fell by 21% over the past 30 days, yet competing blockchains experienced steeper declines. Fees on the BNB Chain dropped 67%, while Ethereum saw a 41% decrease over the same period, according to Nansen data. Additionally, the number of transactions on Solana increased by 6%, while activity on the BNB Chain decreased by 42%.

Source: CoinTelegraph