# Introduction

In mid-August, ETH strongly broke through $4,700, reaching a four-year high, while SOL fluctuated mostly between $180 and $200 during the same period, far behind the performance of BTC and ETH. Reflecting on the meme frenzy ignited by Solana on platforms like Pump.fun in 2024, it was once seen as the terminator of ETH. On January 19, 2025, SOL refreshed its historical high to around $293, followed by a pullback, sideways movement, and fluctuating sentiment, forming a divergence from ETH's "ever stronger" trend. Behind the surface lies a systemic difference in funding entry, value anchoring, and network narratives. So what are the reasons behind this? Can the Solana ecosystem shine again, and can the SOL token take off once more?

This article will analyze the on-chain data and ecological performance of Solana, dissecting the core reasons for SOL's phase-wise underperformance against ETH, and examining the advantages and disadvantages for SOL to take off again. Based on this, we will look forward to the possible trends of Solana in Q3-Q4 2025, providing readers with a systematic reference.

# 2025 Solana Ecosystem Performance Overview

The growth path of Solana is significantly different from that of Ethereum: it captures value not through "high gas fees + deflation," but through high throughput on a single chain and ultra-low fees accommodating massive long-tail and high-frequency trading.

1. Core On-Chain Indicators

Since the beginning of this year, the Solana ecosystem has shown a trend of "high position retreat followed by oscillating upward." TVL and stablecoin supply have shown a stepwise upward trend, with current TVL at approximately $10.42 billion and stablecoin market cap at about $11.62 billion, indicating that the on-chain "underlying dollar liquidity pool" has returned to and stabilized in the $10 billion range; the number of on-chain transactions remains high, maintaining an active "high-frequency/long-tail" trading state; the total market cap of $SOL significantly retreated in Q1 but has shown a wave-like oscillating upward rhythm since Q2; from a structural change perspective, the resurgence of meme popularity has marginally improved DEX/chain fees, but has not yet returned to the peak of the year.

Source: https://defillama.com/chain/solana

2. Meme Coin Sector

As the leading network for meme coins, Solana has produced star meme coins such as BONK, WIF, POPCAT, MOODENG, PNUT, TRUMP, PENGU, FARTCOIN, and USELESS. The common characteristics of Solana memes are "high volatility + strong rotation + strong event-driven," with the total market cap of the Solana meme sector currently around $11.7 billion. The top five hottest meme coins since the beginning of the year are as follows:

• PENGU: A "brand coin" strongly tied to popular NFT IP, with physical toy sales exceeding $10 million, covering over 3,100 stores. Canary Capital has submitted a PENGU ETF application to the SEC, significantly strengthening throughout the year, ranking among the top in Solana memes.

• BONK: The "veteran" of Solana's dog-themed coins and a community traffic entry point, has seen significant growth with the outflow of LetsBonk.fun, but has recently pulled back significantly.

• TRUMP: A Trump meme, driven by political topics, has shown overall downward oscillation since its launch in January. The Trump crypto dinner in May sparked a round of warming, but it is still in a pullback state, sensitive to event catalysts.

• FARTCOIN: Its popularity stems from humorous themes and viral spread: users submit fart jokes or memes to earn coins, with each transaction producing a digital fart sound, combined with AI narratives (created by AI Truth Terminal), making it an AI-meme hybrid that easily triggers FOMO.

• USELESS: USELESS emphasizes "uselessness" as a selling point, satirizing the hollow promises of other coins, becoming the most honest meme coin, where the higher the price, the more useless it becomes, attracting speculation.

Source: https://www.coingecko.com/en/categories/solana-meme-coins

3. Launchpad Sector

The competition for Launchpads on Solana has evolved from "who is cheaper/faster to list" to a contest of "creator economy, token buybacks, and community governance."

• Pump.fun: With a 1% transaction fee and "foolproof issuance," it has ignited the entire chain's meme. In mid-August 2025, weekly revenue reached approximately $13.48 million, returning to a phase high; cumulative revenue has surpassed $800 million; meanwhile, the dramatic recovery of "market share from 5% to ~90% in two weeks" has attracted widespread attention.

• LetsBonk.fun: Quickly rose after its launch in April 2025, capturing over 78% of the issuance share in July, but has since seen a decline. Its "community mobilization + low-threshold issuance" approach remains one of Pump.fun's core competitors.

• Bags: Focused on "creator profit sharing/royalties," emphasizing creator earnings and continuous distribution, entering a niche track tied to opinion leaders/creators, with nearly $1 billion in trading volume over the past 30 days.

• Moonshot: A fiat entry-level app that supports Apple Pay direct charging and fiat deposits. It once topped the "Finance Free Apps" chart in the US App Store, significantly lowering the entry barrier for newcomers.

• Believe: A social media entry point with "reply to earn coins," faced controversy in June for suspending some on-chain revenue sharing/turning to offline payments, and adjusted automatic listing to "manual review."

Source: https://dune.com/adam_tehc/memecoin-wars

4. DeFi Sector

Solana's DeFi resembles "high-frequency/long-tail trading infrastructure." Raydium/Orca handle DEX trading and liquidity, Jupiter/Drift manage derivatives trading and route fragmented liquidity, while Kamino enhances capital efficiency, and Jito/Marinade provide "stable yield + liquidity" as underlying assets.

• Raydium (AMM + ecosystem launch pool): A veteran DEX/AMM on Solana, handling most long-tail spot liquidity and launch pool functions; fees and revenue rank among the top in the industry over the long term, showing a positive feedback loop of "platform cash flow---token value."

• Jupiter (aggregator + trading entry): The default router for Solana, integrating liquidity from multiple DEXs like Raydium; the JPL pool aggregates a large amount of liquidity and has announced the upcoming launch of a lending sector.

• Kamino (unified liquidity/lending/market-making position management): Known for "active market-making treasury + lending," its TVL has long ranked at the top of Solana, becoming a "distribution center" for LPs and capital.

• Jito (LST + MEV infrastructure): By making MEV explicit through the Jito client/block engine/"Bundles," and allocating part of the MEV to stakers via jitoSOL, Jito tips have accounted for a significant proportion of the on-chain "real economic value (REV)."

# Analysis of SOL's Underperformance Against ETH

ETH has established a complete closed loop of "compliant funds → secondary liquidity → market making/derivatives" through spot ETFs, combined with a larger corporate treasury scale and the narrative of being the "on-chain financial hub," forming a stronger capital attraction and valuation anchor; Solana focuses on a trading-oriented ecosystem of "high-frequency/long-tail applications," where price elasticity relies more on thematic prosperity (Meme/Launchpad, etc.), making it easier to "lose its anchor" during risk appetite declines or thematic rotations.

1. ETF Capital Increment Gap

• SOL: There is already a Solana ETF (SSK) in the US stock market that offers staking rewards, but it is structurally complex and not a SEC-registered spot ETF, with cumulative net inflows since its listing of only about $150 million, far less than the capital-raising ability of ETH ETFs. Short-term market focus is on the SOL spot ETF applications from VanEck and Grayscale, which, if approved around October, may open up a compliant model and passive capital channel similar to ETH.

• ETH: The scale of spot ETFs has surpassed $22 billion, becoming the main entry point for institutional funds. Leading institutions (like BlackRock) are advancing applications for "stakable ETH ETFs," which, if realized, will combine "staking rewards" and "compliant channels," further solidifying long-term allocation.

2. Corporate Holdings Scale Gap

• SOL: Known as "SOL MicroStrategy," Upexi currently has a NAV of about $365 million, holding 1.8 million SOL, and has invited Arthur Hayes to join its advisory board to strengthen strategy and visibility; other listed companies (like DFDV, BTCM) are also slowly increasing their holdings, but the overall scale still has a significant gap compared to ETH treasury strategies.

• ETH: BitMine Immersion (BMNR), which positions itself as "ETH MicroStrategy," plans to increase its financing scale to $20 billion, with a current NAV of about $5.3 billion, ranking second only to Bitcoin's MicroStrategy; at the same time, endorsements from globally influential opinion leaders like Tom Lee significantly strengthen market narratives and capital appeal.

3. Network Narrative Positioning Differences

• Solana: More inclined towards "single-chain high throughput + ultra-low fees" for consumer applications and speculative hotspots (Meme, Launchpad), has attempted to penetrate RWA multiple times this year, but most have ended in failure; in August, the joint issuance of dollar money market fund tokens (CMBMINT) by China Merchants Bank International × DigiFT on Solana was a rare compliant RWA positive case, with SOL reaching $200 on that day, seen by the market as a potential narrative switch point.

• Ethereum: Ethereum is building compliant and sustainable on-chain financial infrastructure and clearing layer status, receiving "structural subscriptions" from institutions. Half of the stablecoin issuance and about 30% of gas fees occur on Ethereum; at the same time, Robinhood launched stock tokens on Ethereum L2, and Coinbase is fully developing Base.

4. Value Capture Mechanism Differences

• Solana: Achieves ultra-high interaction density through low fees + high throughput, with value capture relying more on total transaction volume and application layer fees/MEV; when meme/long-tail activities recede, chain fees and application fees cool down simultaneously, weakening the valuation anchor.

• Ethereum: EIP-1559 burns the base fee directly, showing net deflation/low inflation during busy periods, combined with staking rewards, forming a valuation anchor of "supply-side contraction + cash flow."

5. Historical Risk Memory and "Credibility Discount"

• Solana: The approximately 5-hour downtime on February 6, 2024, and subsequent occasional consensus node declines, although repaired, still remain a risk factor in institutional pricing tables.

• Ethereum: "No downtime" and a broader developer/compliance ecosystem lead to a lower credibility discount—when macro volatility rises, this discount will be amplified by the market.

# Can SOL Take Off Again: Advantages/Disadvantages Analysis

SOL possesses a fundamental base of "high activity + low fees + MEV sharing + application layer cash flow," combined with catalysts like spot ETFs and RWA compliance, providing a complete opportunity for another trend to rise; however, with ETF increments not yet realized, treasury scale and narratives still weaker than ETH, and historical stability shadows not fully digested, prices remain highly "event-driven."

1. Advantages and Bullish Logic of SOL

• Single-chain throughput + low fees = natural soil for active and long-tail assets
  Solana handles tens of millions of interactions per day on a single chain, with trading and market-making being naturally active, and extremely low fees conducive to the continuous trial and diffusion of memes, long-tail assets, and high-frequency DeFi.

• Compliant RWA is being prototyped
  China Merchants Bank International (CMBI) × DigiFT has tokenized dollar money market funds and deployed them simultaneously on Solana/Ethereum and other chains, claiming to be the first publicly compliant MMF on Solana, bringing "cash-like assets interpretable by institutions" and fiat/stablecoin entry. This is a potential "long-term capital narrative."

• Predictable inflation curve
  Solana's established inflation model: an initial 8%, decreasing by 15% every "year" (~180 epochs), with a long-term target of 1.5%. The actual annualized rate in 2025 is expected to be around 4.3%-4.6%, with community discussions on proposals to accelerate deflation. The predictable downward inflation is beneficial for medium to long-term valuation anchors.

• Approval of spot ETFs = "capital floodgate" opens
  Several institutions, including VanEck, have submitted or updated S-1 filings for SOL spot ETFs to the SEC; once released, it will replicate ETH's path of "compliant funds → passive allocation → market making/derivatives," attracting more corporate treasury participation.

2. Disadvantages and Bearish Logic of SOL

• Real ETF increments are still on the way
  The scale of ETH's spot ETFs > $22B, forming a closed loop for institutional funds; while SOL is still in the application/communication phase, the current "staking" products in the US are not standard SEC spot ETFs, with far weaker capital attraction. Realized vs. expected is directly reflected in relative returns.

• Treasury strategy scale and "spokesperson" gap
  The scale of treasury companies in the ETH camp (like BMNR) is significantly larger than that of the SOL camp (like Upexi), backed by first-line opinion leaders like Tom Lee; while SOL's treasury is still in the "catch-up phase." This means that during turbulence, those with more firepower will prevail.

• Network narrative of "financial hub vs. consumer/speculative chain"
  ETH firmly occupies the narrative high ground of stablecoins/clearing/compliant finance; Solana relies more on memes/launchpads/long tails to drive activity and fees, with thematic rotations directly impacting on-chain fees and cash flow, making price anchors more "drifting."

• "Fee competition" from ETH itself
  The reduction in fees on the Ethereum mainnet, along with competition from networks like BSC, Base, and Sui, means that "low fees" are no longer Solana's unique selling point, leading to a diversion effect on new developers and capital.

# Q3-Q4 SOL Trend Outlook and Summary

The essence of Solana remains a consumer-grade high-frequency chain characterized by "high activity, low fees, and application monetization." Whether it can "take off again" in Q3-Q4 hinges on whether ETFs can bring in compliant increments, whether RWA can run through a scaled closed loop, and whether network stability continues to improve.

• Baseline scenario: Q3 enters a phase of "trading recovery + narrative waiting" with oscillating upward trends. On-chain activity and DEX/perpetual transactions maintain high levels, with memes showing a pulsing cycle of activity---retraction---and renewed activity. On the price front, SOL is roughly pulled back and forth around "valuation center uplift due to fundamentals" and "risk premium contraction from event expectations," with a tendency towards oscillating upward.

• Bullish scenario: If spot ETFs are approved around Q4 or enter a clear effective window, combined with the regular issuance of RWA (not just individual MMFs, but more government bonds/bills/fund products), then SOL's "capital floodgate, sustainable cash flow, and network resilience" will be simultaneously strengthened, and prices are expected to show a trend upward, potentially breaking previous highs.

• Bearish scenario: Further delays or rejections of ETFs, significant retreat of memes/launchpads, or the emergence of innovative functions or hot topics from other main chains may trigger a loosening of valuation anchors and a collapse of trading beta; if combined with macro tightening or significant fee reductions on Ethereum mainnet/L2, SOL will enter a structure of "high volatility downward---weak rebound."

Conclusion

Solana has experienced a rollercoaster of popularity in 2025. From the dazzling brilliance under the meme frenzy at the beginning of the year to a relatively dim performance in the face of ETH's aggressive pressure mid-year, the market's positioning of Solana has wavered multiple times. However, it is certain that the unique value of Solana's high-performance public chain remains prominent, and its ecosystem has not stagnated due to a temporary cooling. In the long run, whether Solana can lead again depends on its ability to convert its high-speed network advantages into sustained user value: retaining users after the speculative tide recedes and expanding broader application boundaries; also winning mainstream capital trust and sharing in the compliance process. Fortunately, we have already seen signs: whether in institutional layouts, technological upgrades, or ecological narrative transformations, Solana is accumulating strength. Perhaps the current pullback is more like a buildup, waiting for the right moment to take off again.

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