Key takeaways:
- The total value locked (TVL) in Solana-based DeFi protocols has experienced exponential growth since the beginning of August
- TVL now stands at $13.62 billion, having gained more than 1000% since August 1
- SOL has been trading within striking distance from its previous ATH over the last couple of days
Decentralized finance (DeFi) activity in the Solana ecosystem has been surging since the beginning of August. The total value locked (TVL) on the Solana blockchain has reached an all-time high of $13.62 billion on October 25 and shows no signs of slowing down.
More than $13 billion locked in Solana-based DeFi protocols
Solana has been one of the best performing digital assets of 2021, with year-to-date gains of over 13,000%. The blockchain network has been repeatedly dubbed “Ethereum killer” due to its highly efficient proof-of-stake (PoS) consensus mechanism that uses far fewer resources to process transactions compared to ETH’s somewhat outdated proof-of-work approach.
While the Ethereum network still accounts for by far the biggest share of TVL locked in its DeFi protocols (with $162 billion at press time), according to data aggregation service DefiLama, Solana has been steadily closing the gap over the past couple of months.
While the TVL figure stood at “only” $1.22 billion on August 1, the number has since increased to over $13 billion in the span of fewer than three months. Saber automated market maker (AMM) optimized for the trading of native Solana assets accounts for the biggest share of TVL with $2.07 billion. Saber AMM is followed by Raydium with $1.91 billion, Sunny with $1.91 billion, and Sunny’s TVL of $1.74 billion.
Unsurprisingly, Solana’s price performance has been closely aligned with the success of the DeFi ecosystem. SOL has reached its ATH above $213 on September 9, while TVL reached its respective ATH figure just three days later.
SOL’s stellar showing in the last couple of months can in large part be attributed to the non-fungible token (NFT) boom. For instance, the NFT sale of ‘Degenerate Apes’ digital collectibles in mid-August has pushed the price of SOL to its then highest mark of $64. According to DapRadar, Solana’s NFT marketplace Solanart has grown by 117% month-over-month.
Ever since Bitcoin reached its new ATH last week, Solana has been on a tear – growing by 33% in the span of seven days and placing as the 5th largest cryptocurrency by market cap on a $63 billion valuation.
At the moment, Solana is just 2% removed from its previous all-time high and is currently exchanging hands at $209. Given the positive sentiment permeating the markets, SOL is very likely to set a new high in the coming days.
