The key take-aways
- Solana’s futures rates of funding have flipped to the negative side, which signals a large demand for short positions.
- Base and Hyperliquid, two rival networks that aggressively capture the DEX market volumes, pose a direct threat to Solana.
Solana’s native SOL token (SOL), which was rejected at $98 in May, suffered a 15 percent correction. The funding rate for futures fell on Tuesday, which indicated a greater demand for SOL short positions.
Although declining network activity has contributed to the drop in price, there is now more competition between rival blockchain networks.
SOL annualized futures funding rate Source: Laevitas
SOL’s perpetual futures financing rate fell to -3% Tuesday from +8% Saturday. In neutral markets, the indicator will hover around +9% in order to take into account exchange risks and cost of capital. Since Saturday when the SOL fell below $90, there hasn’t been much demand for leverage.
Solana DEX activities have declined 56% from January
Decreased activity on Solana’s decentralized exchanges, or DEXs, has decreased ecosystem revenue and SOL demand. The reduced interest in decentralized applications was not limited to Solana. However, growing competition is a serious threat as investors are concerned that the DApps will be abused by competitors. demand for memecoins Has faded forever
Solana weekly DEX volumes, DApps revenue, USD. Source: DefiLlama
Solana DApp revenues have stabilized at around $20 million a week. This is down from the average revenue of $35 million that was recorded in January. The movement is similar to the DEX trend on the network, where $11 billion in activity per week has been recorded, as opposed to an average of $25 billion for January. Pump, AxiomPro, Phantom, Jupiter and Phantom are Solana’s 30-day DApp leaders, with a combined share of market value of 65%.
Blockchains ranked according to weekly DApps revenues. Source: DefiLlama
Solana remains the number one blockchain for DApp revenues despite increasing competition. Hyperliquid posed a threat to Solana due its dominance in perpetual contractsIt offers high-throughput solutions with the core trading functions built into the consensus layer. The Ethereum layer-2 base network offered seamless integration with the Coinbase eco-system.
Solana ranked second in terms of the total value locked, or TVL. BNB Chain was third with $5.5 billion followed by Base ($4.5 billion). Solana has the highest TVL thanks to DEX platforms, staking DApps, such as Jupiter, Kamino Sanctum and Raydium, and DApps that use DEX. Yet, there is no threat to Ethereum’s TVL (which amounts to $43.2bn) which heavily relies on liquid staking, collateralized loans, and staking DApps.
Solana DApps are susceptible to spoofing.
Solana’s impact on the DApp sector cannot be underestimated. But the network’s low fee structure offers a perfect environment for MEV betting and inflating activity.
Related: Goldman Sachs exits XRP, Solana ETF exposure in Q1 2026
Source: X/lukecannon727
Lukecannon727, an X-user from the Solana Network, noted that nearly 63% on PreStocks – a trading platform for synthetic assets – was attributed to 1,600 IP addresses. The analysis showed that these entities had a balanced trading pattern, exhibited high execution frequencies, and suffered small losses. The findings of this analysis are consistent with the arbitrage, but could also be indicative of volume spoofing.
The recent weakness of SOL can partly be attributed to a broader drop in DApps and the increased competition from Hyperliquid and Base. The eventual bull market seems to be highly dependent on an increase in DEX activities, particularly memecoin trading. SOL has not retested the $78 price level seen last in early April.
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Source: cointelegraph.com
