Solana’s dominance in the DeFi space weakened further. Despite the fact that the overall market is recovering, Solana underperformed in the DeFi market.
Well, the decrease in DeFi activity could indicate a general decline in interest in Solana’s ecosystem.
Notably, Solana’s overall TVL has remained flat over the last three months, causing concern.
One of the reasons for this was a decrease in dApp activity. Popular dApps such as Raydium and Saber have reported a decrease in the number of unique active wallets on the network.
This indicated that Solana’s DeFi applications were not receiving much attention from users.
The decreasing number of DEX wallets on the network was another indicator of Solana’s declining DeFi activity.
A decentralized exchange, or DEX, is a platform that allows users to trade cryptocurrencies without the use of intermediaries.
If this trend continues, Solana will find it difficult to compete with other DeFi ecosystems on the market.
Despite the decline in DeFi activity, Solana’s NFT growth was promising. In comparison to the DeFi space, Solana’s NFT market was buzzing with increased user interest.
Solana’s NFT market share increased from 6% to 14% in the last few months, according to Delphi Digital data.
Despite a drop in prices, NFT volume remained consistent, which was a good sign for Solana’s ecosystem.
Another piece of good news for the ecosystem was the increasing number of buyers. Surprisingly, the number of buyers outnumbered the number of sellers.
Nonetheless, the overall volume of SOL fell, and price volatility increased. The overall volume of the SOL token has decreased from 725.53 million to 353 million in the last month, according to Santiment data.
It should be noted that rising volatility would discourage risk-averse investors from purchasing the SOL token.
To ensure the long-term success of its ecosystem, Solana must find a way to maintain its DeFi activity while also capitalizing on its NFT growth.