- Solana’s network activities surged as active participants increased to 932k in March, from the 426k recorded in February.
- This also exposed the network as the transaction failure rate increased with developers failing to provide a quick fix.
Solana (SOL), a blockchain platform that uses a Proof-of-Stake (PoS) mechanism to provide smart contract functionality, has cemented its reputation in the past few weeks with an incredible surge in network activities. According to a report shared by popular crypto influencer and YouTuber Lark Davis, the Solana network recorded a staggering 2.4 billion transactions in the first quarter of 2024.
The dominance appears unmatched as the combined transactions of the next nine networks (TRON, Near, BNB, SEI, Polygon, Injective, Sui, ZkSync, and Ethereum) trail Solana. Interestingly, this has been the case for the past couple of months now, however, the intense hype surrounding meme coins pushed Solana to its limit.
Researchers estimate that thousands of meme coins were created on Solana out of thin air over the past month with billions of dollars in trading volume. An April report by CoinGecko discloses that meme coins were the most profitable crypto sector in Q1 2024 with an average return of 1,312.6%.
According to analysts, the meme frenzy is the reason for the incredible surge in transaction numbers, leading to a higher fee revenue for the network.
Solana Transaction Failure Rate Increase
A review of Token Terminal data shows that Solana racked up more than $34 million in March, making it the third-highest revenue-generating platform in Web3. In comparison, the revenue in March was almost 6x the figure generated in the previous month. In addition to the fees, Solana also saw an increasing number of active users participating on the network.
Data shows that 932k users were active in March compared to the 426k active in February. Unfortunately, the huge activities exposed the network to a high number of transaction failure rates.
According to reports, developers were unable to trigger a quick fix as the problem persisted for some time. This resulted in Solana trending massively on X with Santiment data disclosing that 42% of the comments were negative with words like “transactions”, “network”, and “time”. Solana’s network has always been known for its fast transactions and low cost. However, the transaction failure reached 75% on April 4, before dropping to 61%.
It is important to note that the transaction failure rate has failed to overturn the market sentiment of Solana as 44% of commentary in the last 24 hours are bullish. Many enthusiasts expect SOL to outshine Ethereum in the long run since it has the edge in terms of fees and speed.
According to analyst Ali Martinez, this could be the time for the asset to bounce back.
Crowd sentiment for SOL hasn’t been this low since the Solana network outage on February 6th. Being contrarian now might just pay off!
Another analyst also expects SOL to surge to as high as $620 after the Bitcoin halving event as formerly reported by Crypto News Flash. At press time, Solana was trading at $173 after declining by 1% in the last 24 hours. Market data also shows that its 24-hour trading volume is down by 19%.
