Solana: Good stablecoin volumes, but can SOL lose 2023’s gains?

• Solana’s market share jumped to nearly 32% this month, compared to just 1.17% a year ago.
• SOL continued its slide, losing 5.46% of its value over the week.

Solana [SOL] was slowly emerging as the go-to chain for stablecoins.

According to AMBCrypto’s analysis of Artemis data, the monthly stablecoin transfer volume on Solana reached a record high of $316 billion this month.

This also marked the fourth straight month of growth in the aggregate value of stablecoins transferred on-chain.

Source: Artemis

Solana surpasses Tron for the first time

The transfer volume on Solana increased by 6% from the previous month, surpassing that of Tron [TRX] for the first time.

On a yearly timeframe, this equated to a staggering 250% jump from just $11.56 billion in January 2023. Moreover, the market share of stablecoin transfer volume on Solana jumped to nearly 32% this month, compared to just 1.17% a year ago.

With a share of 33.21%, the Ethereum [ETH] network held on to its numero uno rank.

But while transfer volume surged, the circulating supply of stablecoins on Solana continued to be on the lower side.

Solana’s stablecoin supply has yet to recover

With about $1.88 billion, Solana stood fifth on the list of chains by stablecoin market cap. This equated to just about 1.39% share of the total market.

In fact, the market share has failed to reach even 2% since November 2022. This was also the time when the FTX exchange collapsed, causing a ripple effect on Solana’s critical performance metrics.

Source: Artemis

USD Coin [USDC] was the dominant stablecoin on the Solana blockchain, with a 55.58% share of the total supply, according to AMBCrypto’s examination of DeFiLlama data.

In fact, just last week, Artemis acknowledged in an X (formerly Twitter) post that USDC volumes on Solana were the primary drivers in boosting overall stablecoin transfer volumes.

SOL losing gains made in 2023

Meanwhile, the network’s native token SOL continued its slide, losing 5.46% of its value over the week, according to CoinMarketCap.

How much are 1,10,100 SOLs worth today?

The fifth-largest asset has now descended 11% since the start of the year, in sharp contrast to its performance in the last quarter of 2023 during which it jumped 5x.

The downward price action led traders to go short on the asset. AMBCrypto discovered using Coinglass data that SOL’s bearish bets have outnumbered bullish bets on most days since the start of 2024, reflecting a negative sentiment.

Source: Coinglass