Solana’s Surge: Why is It Set to Lead the Blockchain Industry?

As time goes on, Solana keeps improving its position as a major force in the blockchain world, leaving many of its competitors in the rear view. Where the likes of Ethereum, Binance Smart Chain and TRON once held the spotlight, now it’s Solana’s turn to be in the lead.

Dune Analytics’ data shows that, in 2024, Solana’s stablecoin supply jumped 156% compared to last year, reaching over $3.7 billion. Better still, it also hit a new record for real economic activity in October ($36.8 million), while the TVL has surpassed $6 billion for the first time since 2022.

The growth is impressive, and it clearly shows that the opportunities within the Solana ecosystem are growing. In this article, let’s explore why that is the case.

What Is Fueling Solana’s Growth?

Solana offers vast opportunities, but its growing popularity comes to a simple thing: it’s fast and cheap. However, some users want the transactions to be even faster, so they are paying priority fees to speed up the processing. Last week (October 21-27, 2024) the amount paid jumped almost twice (from $8.3M to $15.2M), which significantly boosted the real economic value activity. Another key factor in Solana’s growth was the rise in Jito tips (where users tip to ensure smooth transaction processing) — they surged from $10.3M to $20.1M in the same week.

These figures highlight how the trader’s interest towards Solana is going up, especially those who want to launch new projects. The main attraction is, once again, low costs. Transaction fees on this chain remain competitively low — just a fraction of a cent, compared to, for example, Ethereum, where the fees per transaction can reach $6–8.

Another reason for Solana’s success has been, of course, the boom of DeFi opportunities within its ecosystem. Protocols like Sanctum, Jito, and Kamino have attracted new waves of users by offering creative solutions for things like lending, staking, and liquidity provision. They are successfully drawing in crypto investors with high yields and point systems with promises of airdrops from several projects. This is not just giving a boost to Solana’s DeFi landscape but also brings more liquidity into the whole ecosystem.

Additionally, the launch of decentralized exchanges and cross-chain bridges between Solana and other blockchain networks plays a significant role in the ecosystem’s success. Take Jupiter, for example — one of the top Solana-based platforms in 2024, the DEX aggregator boasts consistently high trading volumes. On October 25, it nearly crossed the $2B mark, establishing a new record.

Bridges, meanwhile, are adding to Solana’s popularity by simplifying transfers across other networks and giving users opportunities to diversify their strategies. All without needing to leave Solana’s ecosystem. For developers, this means getting access to a broader user base. For investors, the chance to move assets across chains quickly and cheaply (as we’ve already covered earlier).

Finally, one of the biggest attributes that Solana can boast of is true decentralization. Unlike BSC or XRP, Solana’s infrastructure is fully driven by the community, which has helped a lot in terms of establishing trust among users and positioning Solana as a genuine option for developers devoted to the core idea of decentralization.

SOL Token’s Bullish Outlook

What can we expect soon? As of October 27, Solana’s SOL token was trading at $179. End-of-the-year periods historically tend to mean price increases for tokens. Forecasts also say that a bull market is expected to begin at the end of 2024. And not only that, Bitcoin’s halving has already passed earlier in the year, and prices always go on the rise after that.

So with everything above taken into account, we can reasonably expect SOL to reach around $200 by the end of 2024. And if it manages to break out of its current accumulation phase, it could even potentially challenge its previous all-time-high of $259.

The data brought up at the beginning of this article also supports this line of thinking, showing Solana’s rising popularity. With more projects moving to Solana to take advantage of its opportunities, SOL’s future growth seems like a safe bet.

Admittedly, these are just my personal observations and should not be taken as gospel or financial advice. Volatility is always a factor in crypto, so market participants should carefully consider their options before making any decisions about buying or selling SOL.

Stablecoins on Solana Are the Future of Payments

Typically pegged to fiat currencies like USD, stablecoins offer a sense of safety and usability that more volatile cryptocurrencies cannot. This makes it far easier for them to take an increasingly important role in the global financial infrastructure; stablecoins are already becoming essential for making both everyday transactions and large-scale business payments.

Solana is in a good spot to benefit from their rise. For example, stablecoins like PayPal’s PYUSD have already made an impact —  where it struggled to scale on Ethereum, PYUSD has gained almost $250 million in market cap​ on Solana between May-October 2024.

Users mostly prefer using USDT and USDC on Solana since it ensures fast, low-cost stablecoin transactions. These stablecoins can be confidently called the most popular, as they are already a mainstream payment tool. Between October 2023 and October 2024, their market cap jumped $36B and $9,7B respectively. At the same time, Tether recently released data that shows how the number of on-chain wallets has grown to 330 million by Q3 2024, with the average growth of 9% across the last four quarters. This surge in popularity is significantly benefiting Solana as well.

Solana’s Future is Bright

At this point, I’d say that we have firmly established that Solana’s growth in 2024 is no fluke or empty hype. It’s built on genuine technological advantages and real-world benefits for users and developers alike. Solana’s ability to offer fast and affordable transactions, paired with its thriving DeFi landscape and strong stablecoin support, makes it a strong contender for leadership in the blockchain world.