In recent developments, Solana‘s native cryptocurrency, SOL, saw its market value diminish as it experienced a 13% price fall over a week, dropping to the $101 mark. This decline in value has led to concerns among investors regarding reduced interest in the token as the excitement around airdrops seems to be waning. Despite this, Solana’s ecosystem continues to witness active engagement, with the network’s decentralized applications (DApps) maintaining a steady user base.
Diminished Enthusiasm for Airdrops Impacts SOL
The ebbing price of SOL is partly due to the sluggish performance of Solana SPL tokens such as Jito (JTO), Jupiter (JUP), and Dogwifhat (WIF) starting from February 19. Investors who had placed their bets on airdrops for quick gains are now facing disappointment as these events have not lived up to expectations. Although airdrops have been a factor, the network’s DApps, including the decentralized exchange Raydium with over 172,000 active addresses and the NFT marketplace Magic Eden with close to 168,000 active users in the previous week, continue to thrive.
When compared to other blockchain networks for the week up to February 21st, Solana’s DApps’ volume amounted to $813 million, falling short of Polygon’s and BNB Chain’s significantly higher volumes. Notably, Solana was the only blockchain among the top seven that did not register a volume increase, and its growth in active addresses was outpaced by Ethereum and BNB Chain.
Resilience in Network Engagement
Despite the dip in SOL’s price, the Total Value Locked (TVL) within Solana’s DApps has reached a milestone, peaking at 37.7 million SOL on February 17th, the highest since November 2022. The TVL, standing at 36.3 million SOL, has shown a 13.5% increase from the previous month. This suggests a growing interest in the network’s offerings beyond just airdrop incentives.
Moreover, data from StakingRewards reveals that the proportion of SOL staked has reached 67.3% as of February 21st. A higher TVL and staking ratio often reflect a resistance to selling in the short term, indicating that the current holders remain steadfast despite the downturn in SOL’s market price.