In a groundbreaking development within the cryptocurrency world, Solana (SOL) has outperformed Ethereum (ETH) in terms of profitability for the first time ever. This milestone positively affected Solana’s market value, marking a significant achievement in its ongoing rise. Recent data reveals that Solana’s daily economic value has reached $2.25 million, surpassing Ethereum’s $1.98 million.
What Does the Data Show?
On-chain analyst Dan Smith recently posted on X, shedding light on Solana’s increased economic value. The shared data, spanning from February 14 to May 12, 2024, showed a comparison of economic value generated by both Solana and Ethereum. The values, based on transaction fees and miner extractable value (MEV), highlighted a notable shift in blockchain profitability.
Ethereum’s economic value had initially risen to approximately $40 million by late February. However, it experienced a significant decline in the following months, stabilizing between $10 million and $15 million in April, and eventually falling to below $2 million by May 12. In contrast, Solana, which started with an economic value of around $1 million, saw a consistent rise throughout March, driven by the meme coin phenomenon.
How Did Solana Achieve This Profitability?
By the end of the observed period, Solana’s economic value had climbed to about $2.25 million, surpassing Ethereum. Toghrul Maharramov from Scroll ZKP noted that Ethereum’s MEV remained relatively steady, but the implementation of EIP-4844 reduced transaction fees, which impacted Ethereum’s economic value. Despite Solana’s milestone, the broader use of Ethereum as a burn mechanism in various layer-2 networks was not factored into this analysis.
Key Insights for Investors
– Solana’s economic value rise indicates its growing transaction efficiency.
– The impact of EIP-4844 on Ethereum’s fees suggests a need for strategic fee management.
– Monitoring meme coin trends can offer predictive insights for investment opportunities.
– Understanding the role of layer-2 networks is crucial for comprehensive profitability analysis.
Conclusion
Following the recent market movements, attention has shifted to Solana’s price. Investors were encouraged by an upward trend in SOL’s value, which surged by 6.81% in the past 24 hours, pushing the price above $150. This increase is significant considering it was trading at $141.42 the previous day. Consequently, Solana’s market cap has exceeded $69 billion, with a 24-hour trading volume surpassing $3 billion, reflecting a 14% increase.