Introduction
Token Price
Total Value Locked
Stablecoin Supply
Daily Active Addresses
DEX Volume
DeFi Majors Market Cap & Growth
Relevant Ecosystem News
Visa x Solana
Conclusion
Introduction
In today’s newsletter, we will cover several metrics such as Total Value Locked (TVL), Active Addresses and Stablecoin Supply. It has been a while since we’ve covered the state of Solana DeFi so it is only right that today we bring you the most recent data and analysis of the Solana ecosystem.
Token Price
If one were to judge what happened on Solana based on the last three months of price action, most guesses would have been far from reality. The SOL token price has been essentially flat since May, with a significant correction of 30% in June, sparked by the Securities and Exchanges Commission's (SEC) move to sue Binance and Coinbase, which stated that Solana and several other tokens were securities. The recovery was fast, ending with a strong touch of pre-FTX levels. Since May, the SOL token price reached a low of ~$12.50 and a high of $32.00. As with the entirety of the crypto market, August was a period of cooldown and apparent apathy, as trading volumes dropped sharply.
Total Value Locked (TVL)
After the initial shock caused by the SEC claims of SOL being a security, TVL climbed 31% to yearly highs. Solana Total Value Locked has hit a yearly high of $328M in August. Although the SOL price went up to yearly highs and dropped 35%, TVL did not slow down or decrease and instead has been holding above $300M-$310M. One major reason for this has been the positive change in sentiment among crypto investors, in addition to the rise of certain DeFi protocols such as marginfi.
Stablecoin Supply
Stablecoins are a structural part of any decentralised ecosystem. They facilitate trading on exchanges, transactions and payments. One of the most meaningful use cases of stablecoins is they allow users to hold non-volatile assets on blockchains.
They are also incremental to DeFi. Protocols need deep liquidity to function appropriately, which can only be obtained from a stable asset like USDC.
Per the European Central Bank, Stablecoins provided around 45% of the liquidity in decentralised exchanges (DEXes) in May 2022. This number is expected to grow as decentralised protocols gain traction and develop more user-friendly UI/UX.
The Solana Stablecoin Circulating Supply recorded a monthly high of $1.58B and is currently at $1.53B.
Daily Active Addresses
The Solana Daily Active Addresses chart shows the daily number of unique addresses that were active on the network as a sender or receiver.
The daily active addresses declined ~23% in the last three months, from ~252K to ~193K.
DEX Volume
Solana DEX Volume continues to show resilience and strength. The most recent evidence is how the monthly DEX volume surpassed $1B in August, extending a streak of eight months with volumes exceeding the $1B milestone. There are two main takeaways from this data.
Although June and August were months of fear and apathy in the crypto markets, the monthly DEX volume did not show signs of added weakness, which is proof that the Solana ecosystem is maturing and bringing more liquidity on-chain. In addition, July saw a sharp increase in trading volume due to the positive shift in sentiment around Solana as well as several liquidity incentives created by ecosystem projects such as marginfi, Cypher Protocol, SolBlaze and more.
Relevant News Piece of the Week
Visa to send stablecoin USDC over Solana to help pay merchants in crypto
Visa said on Tuesday that it would begin to send USDC, the second-largest stablecoin by market capitalization, to select merchants via Solana in a newly announced pilot.
Visa, which has a dedicated account with Circle, will begin to send USDC out of its treasury to payment firms Worldpay and Nuvei which can directly facilitate payments for merchants. Visa and the Merchants state that they have decided to send and receive USDC on Solana because of the blockchain’s capacity to process transitions faster than on Ethereum.
Conclusion
Data supports that Solana is healing. Year-to-date, several measures such as TVL and DEX Volume show that the DeFi ecosystem is not only recovering but in some cases growing beyond the pre-FTX levels.