Solana sees significant growth across DeFi, NFTs: Messari
After a turbulent 2022 due to macroeconomic headwinds, Solana’s performance improved significantly in the first quarter of the year. Data suggested that the market capitalization increased by more than 118% QoQ along with the broader market.
Furthermore, a number of ecosystem developments promoted activity for fee payers and transactions during the first quarter.
Solana’s performance in Q1
Solana’s network outage previously sparked talks about potential insolvency. But performance stabilized after upgrades such as QUIC, priority charging (local charge markets) and effort-weighted quality of service (QOS). In Q1, the tier one blockchain network experienced significant growth across DeFi, NFTs and GameFi verticals.
According to the latest Messari report, the total value locked in Solana, denominated in USD, increased by 23.5% QoQ. However, TVL denominated in SOL decreased by 40.7% in the same period, indicating that “the increases in asset prices in USD vs. new capital injection drove TVL”.
Liquid staking derivatives (LSDs) continued to support the Solana ecosystem, with Marinade Finance, Lido, Jito and JPool increasing TVL by 100% or more during the quarter. These four LSDs also managed to get into the top 20 of TVL.
Other protocols, such as Orca, Raydium and Solend, massively increased their TVL along with the broader market upturn.
A similar trend was also seen across Solana’s NFT ecosystem. Messari’s data revealed that the total number of daily new NFTs increased from 2.6 million to 2.9 million QoQ, which represented an increase of almost 12%. NFT sales volume in the USD secondary market increased by almost 36%.
This is in contrast to DeFi, as SOL-denominated sales were up 20% before skyrocketing, essentially signaling that “sales activity was not solely driven by USD price increases.”
Meanwhile, unique buyers outnumbered unique sellers during the first quarter. The total number of buyers was 889,000, while sellers were recorded to be 887,000.
Subsequent FTX implosion
Solana’s strong ties with Sam Bankman-Fried’s crypto empire – which invested in nine of his projects from December 2020 to March 2022 – proved to be a disaster for the network. This ignited rumors of a developer exodus.
But with the launch of more and more applications this year, their user base also increased. This trend helped increase and stabilize active programs in the Solana ecosystem. As such, there were 58,000 unique active programs in Q1 2022, which has increased to 96,000 in Q1 2023.
