- Earlier this month, Base’s TVL crossed above that of the Solana network.
- Solana was still moving forward despite the weak TVL performance.
Coinbase’s Base network has been growing at a rapid pace since its launch. The fact that it is an Ethereum [ETH] layer 2 network may partly explain the initial growth but there is one other reason behind the more recent healthy growth figures.
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Before we dive into that reason, it would be better to truly understand the level of activity that the Base network has achieved so far. Its TVL performance is perhaps the best example of Base’s growth. TVL data revealed that Base surpassed Solana.
Base clocked its TVL at $339.19 million at the time of writing. For context, the network had $8.5 million in total value locked at its lowest point in August. This means that the network’s TVL is up over 290% in the last 2 months.
Source: CryptoQuant
In contrast, Solana’s TVL has been declining since it peaked in November 2021. Interestingly, Base’s TVL surpassed that of the Solana network earlier this month. This outcome demonstrates just how fast the Ethereum layer 2 is growing.
The main reason for Base’s robust TVL growth in September has largely been speculation that that it plans to roll out its native token. Of course, there is an element of organic growth largely from the Friend.Tech decentralized social platform.
Should Solana investors be concerned?
Solana’s TVL decline does not necessarily reflect the state of the network. In fact, recent developments underscore the network’s commitment towards growth. For example, the Solana network just embraced QCAD, a platform developed by Stablecorp.
This development will offer global accessibility to FX trading pairs and at a 90% cheaper cost than traditional exchanges.
Stablecorp is extremely excited to announce that QCAD is LIVE on @solana ! Users globally can access FX pairs like QCAD / USDC on Orca at 90% lower cost than foreign exchange at traditional venues. PR here: https://t.co/1DZamaSoqU
— Stablecorp Inc. (@stablecorp) September 22, 2023
The development highlights growth opportunities courtesy of projects operating on the Solana network. Solana has achieved significant recovery in development activity in the last two weeks. However, its volume remains dampened and this is a reflection of the slow market conditions across the board.
Read about Solana price prediction for 2024
Solana volume and development activity
The state of SOL’s on-chain volume is important considering its latest price action. The cryptocurrency is having a tough time maintaining bullish momentum despite recently breaking through its descending resistance.
SOL exchanged hands at $19.60 at press time. It is now at risk of capitulation if the market fails to manifest significant demand in the next few days. On the other hand, it is still trading at a significant discount compared to its 3-month highs.
Source: TradingView
