Solana Surpasses Ethereum in Profitability, Ethereum’s Value Drops After EIP-4844 Launch
In a significant milestone, Solana has surpassed Ethereum in terms of profitability, according to on-chain analyst Leon Waidmann. Although this comparison does not take into account Ethereum’s value as fuel and means of payment across various Layer 2 networks, it still highlights Solana’s impressive performance.
A chart provided by Waidmann, based on data from Blockworks, illustrates the total economic value derived from transaction fees and miner extractable value (MEV) for Solana and Ethereum between February 14 and May 12, 2024.
During this period, Ethereum experienced rapid growth in economic value, reaching its highest value of $40 million in late February. However, it then saw a gradual decline with intermittent spikes, stabilizing between $10 million and $15 million by April. The economic value further decreased in the last two weeks leading up to May 12, ending at just under $2 million.
On the other hand, Solana’s peak value was significantly lower than Ethereum’s peak, but it reached notable highs during the same period. Starting with relatively low values in mid-February, Solana experienced a steady increase through March, surpassing Ethereum’s values during April, and finally closing at over $2 million on May 12.
Industry experts have shared their opinions on this development. Toghrul Maharramov noted that Ethereum’s MEV captured didn’t drop significantly, but the fees decreased due to the launch of EIP-4844. Austin Federa mentioned that while Ethereum’s Layer-1 (L1) activity decreased, the activity on L2 networks increased.
The market implications of this development are still being analyzed. Dan Smith suggested that L2 activity should be measured by a different metric, considering that Ethereum derives value from being a gas asset on other chains. He also highlighted the challenge of identifying Ethereum’s growth story.
In a separate development, the surge in GameStop (GME) stock has led to a spike in a Solana meme coin of the same name. Within two days, the Solana-based GameStop coin saw a 3,914% increase in value.
As of now, Solana (SOL) is priced at $143.86 with a 24-hour trading volume of approximately $2.37 billion. It has experienced a 1.60% decline in the last 24 hours and a 2.60% drop over the past seven days. With a circulating supply of 450 million SOL, Solana’s market cap stands at $64.61 billion.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. The views expressed in this article are the author’s personal opinions and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct their own research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.