Despite failing to reclaim the $145 price level since July 3, Solana’s underlying network metrics continue to demonstrate resilience and growth. While SOL has underperformed relative to peers like Ethereum and BNB, its on-chain activity, total value locked (TVL), and derivatives market indicators suggest a potential recovery toward $160 is still within reach.
Market sentiment across the broader crypto sector declined in early July, with total market capitalization dropping 5% over nine days. During this period, SOL fell 7.8%, slightly worse than Ethereum’s 6.5% decline and BNB’s similar drop. Investor interest appeared to wane, contributing to SOL’s sideways movement. However, deeper analysis reveals that structural weaknesses are not driving this stagnation—rather, it reflects broader market consolidation.
Solana’s TVL Rivals BNB Chain in Decentralized Finance Growth
One of the most compelling signs of Solana’s strength lies in its rapidly growing total value locked (TVL). As of July 5, Solana’s TVL reached parity with BNB Chain, marking a significant milestone for the high-performance blockchain. This shift is especially notable given that, by the end of 2023, BNB Chain held more than double Solana’s TVL—a gap of over $2 billion that has now completely closed.
According to DefiLlama, Solana currently ranks among the top ecosystems in terms of TVL, directly challenging BNB Chain for second place behind only Ethereum. The surge in capital inflow highlights growing confidence in Solana’s infrastructure and developer ecosystem.
Key contributors to this growth include:
- Jito, a liquid staking protocol with over $1.6 billion in deposits
- Marinade Finance, holding approximately $1.1 billion in TVL
- Kamino, a lending and borrowing platform also nearing $1.1 billion in locked value
In contrast, while Tron ranks second in TVL at $7.6 billion, nearly 72% of its value comes from a single DeFi application—JustLend. Moreover, 94% of JustLend’s deposits consist of wrapped Bitcoin, raising concerns about transparency and reserve backing. This concentration risk underscores Solana’s advantage: a more diversified and transparent DeFi landscape.
With increasing institutional and retail participation, Solana is proving capable of sustaining robust financial primitives despite short-term price volatility.
Rising User Engagement and DApp Transaction Volume Signal Momentum
Beyond TVL, Solana is gaining ground in user adoption and decentralized application (DApp) activity—a critical indicator of long-term ecosystem health.
Over the past seven days:
- Solana saw a 19% increase in active users
- DApp transaction volume rose 12% to $703 million
- Competitors like Ethereum, BNB Chain, and Polygon experienced declines in both metrics
Ethereum, despite being the largest smart contract platform, recorded a 37% drop in DApp transaction volume during the same period. This divergence highlights shifting user preferences toward faster, lower-cost alternatives like Solana.
Raydium, Solana’s leading decentralized exchange (DEX), attracted 1.71 million active addresses in seven days—an impressive 39% increase. By comparison, BNB Chain’s top DApp, Move Stake, reported just under 200,000 active users over the same timeframe.
This surge in engagement suggests that developers and traders are increasingly building and transacting on Solana, drawn by its high throughput and low fees. Even as SOL’s price consolidates, real-world usage continues to expand—an encouraging sign for future price appreciation.
Derivatives Market Shows Balanced Sentiment Ahead of Potential Breakout
To understand trader psychology, it's essential to examine Solana’s derivatives market—particularly perpetual futures contracts.
Perpetual swaps feature an 8-hour funding rate, which reflects the balance between long (bullish) and short (bearish) positions. A negative rate indicates that shorts are paying longs, often signaling aggressive shorting or leveraged bearish bets.
Notably:
- SOL’s funding rate turned negative between July 5 and July 6
- Since then, it has stabilized near zero, indicating equilibrium between buyers and sellers
This normalization suggests that excessive bearish leverage has been unwound, reducing the risk of a short squeeze or forced liquidations. In healthy markets, neutral funding rates often precede upward momentum as sentiment stabilizes.
👉 Learn how futures market dynamics can predict crypto price movements before they happen.
While no single catalyst guarantees a move back to $160, the absence of systemic stress in both on-chain and derivatives data implies that Solana remains fundamentally sound. Any positive macroeconomic news or renewed investor appetite could reignite bullish momentum.
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Frequently Asked Questions (FAQ)
Q: Why hasn’t SOL reclaimed $145 yet?
A: SOL has been consolidating due to broader market weakness and reduced investor interest in risk assets. However, strong on-chain metrics suggest this pause is temporary rather than indicative of structural issues.
Q: Is Solana’s TVL growth sustainable?
A: Yes. Unlike some competitors reliant on a single protocol or asset type, Solana’s TVL growth is driven by multiple high-quality DeFi platforms like Jito and Kamino, suggesting durable demand.
Q: How does Raydium compare to other DEXs?
A: Raydium has outperformed many rivals in user growth and volume recently, attracting 1.71 million active addresses in a week—surpassing most BNB Chain and Ethereum-based DEXs during the same period.
Q: What does a neutral funding rate mean for SOL?
A: A near-zero funding rate indicates balanced market sentiment. It reduces downside risks from leveraged shorts and sets the stage for potential upside if bullish momentum returns.
Q: Can SOL reach $160 again?
A: Based on current fundamentals—including rising TVL, growing DApp activity, and stable derivatives markets—$160 remains a realistic target if overall crypto sentiment improves.
Q: How does Solana compare to BNB Chain in DeFi?
A: Solana now matches BNB Chain in TVL but offers greater diversification across protocols. BNB Chain faces stiffer competition within its own ecosystem, while Solana benefits from focused innovation in liquid staking and lending.
In summary, while SOL has struggled to break above $145 since early July, the fundamentals tell a different story. With TVL rivaling BNB Chain, DApp activity rising, and derivatives markets stabilizing, Solana remains one of the most resilient layer-1 blockchains in the current market cycle. Investors focused on long-term value may find this consolidation phase an opportunity rather than a setback.