Solana has registered a high transaction fee compared to Ethereum in the past 24 hours as it entered the top 5 networks for this metric.
By Godfrey Benjamin
Edited by Julia Sakovich
Updated
3 mins read
The competition between Solana SOL $120.0 24h volatility: 3.2% Market cap: $61.54 B Vol. 24h: $7.18 B and Ethereum ETH $1 835 24h volatility: 1.5% Market cap: $221.38 B Vol. 24h: $25.34 B is getting more intense daily. Solana is one of the networks that has proven to be a formidable rival to Ethereum since its launch. Recently, on-chain data shows that the Layer-1 Solana blockchain has surpassed Ethereum in daily transaction fee generation. In the last 24 hours, the popular “Ethereum Killer” generated over $2.54 million worth of fees.
This figure shows growing user activity on the Proof-of-Stake (PoS) network.
Within the same period, Ethereum registered $2.07 million in transaction fees. According to DefiLlama data, Solana has successfully attained the position of the fifth-largest fee-generating protocol in the crypto ecosystem. Based on CoinMarketCap data, SOL is the fifth-largest cryptocurrency by market cap at $82.78 billion. It also comes second in the Proof-of-Stake (PoS) coins sector.
These soaring fees on Solana come from growing trading activity on Raydium, a leading decentralized exchange (DEX) on the network. For context, Raydium generated $3.41 million in fees on the Solana blockchain in 24 hours.
Amid this outlook, crypto experts speculate that the price of SOL could likely surpass Ethereum’s.
Optimistic predictions for SOL’s price rest between $148.33 and $386.76. This is in addition to the potential for SOL to improve its position in the market further. Year-to-date (YTD) data shows that SOL has registered a 449.88% increase. On the other hand, ETH has only seen a 40.6% increase within the same time.
SOL’s potential to outperform Ethereum largely rests on its failure to boost its costs, scalability, and network speed. On the flip side, Standard Chartered Bank proclaimed in a recent report that Solana is overvalued compared to Ethereum in Q4. The report also stated that the victory of a pro-crypto leader in the US election could spark a 400% Solana rally.
To a large extent, Solana’s approach to enhance its transaction throughput and reduce fees without relying on Layer-2 blockchain has placed the network on a pedestal. This is not to say that Ethereum is underperforming, especially with its unique smart contract network. However, Ethereum’s fragmented structure highly depends on L2 solutions to achieve scalability.
In the opinion of some cŕtics, this pushes value away from the Ethereum mainnet to side chains. Despite this gloom surrounding Ethereum, Solana’s transaction fees still fell short of ETH over a longer time frame. Within 30 days, Ethereum generated almost $134.6 million in transaction fees. As a result, Solana’s monthly fee of $61.3 million represented only about 45% of Ethereum’s 30-day total. At a glance, this further cemented Ethereum’s position as the leading blockchain.
Significantly, Solana’s blooming outlook is sponsored by the rising memecoin activity on the network. For instance, memecoin launchpad Pump.Fun contributed approximately $29.5 million of Solana’s $61.7 million in fees over the past month.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
