Journalist
Posted:
- Earlier this month, Base’s TVL exceeded that of the Solana network.
- Solana still improved despite TVL’s weak performance.
Coinbase’s Base network has grown rapidly since its launch. The fact that it is an Ethereum [ETH] layer 2 network may partially explain the initial growth, but there is another reason behind the more recent healthy growth rates.
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Before we get into that reason, it would be better to really understand the level of activity that the Base network has achieved so far. The TVL performance is perhaps the best example of Base’s growth. TVL data showed that Base surpassed Solana.
Base clocked its TVL at $339.19 million at the time of writing. For context, the network had a total value of $8.5 million at its lowest point in August. This means the network’s TVL has increased by more than 290% over the past two months.
Source: CryptoQuant
In contrast, Solana’s TVL has declined since its peak in November 2021. Interestingly, Base’s TVL surpassed that of the Solana network earlier this month. This outcome shows how quickly Ethereum layer 2 is growing.
The main reason for Base’s robust TVL growth in September is largely speculation that it plans to roll out its own token. Of course, there is an element of organic growth, much of it coming from the Friend.Tech decentralized social platform.
Should Solana Investors Be Worried?
The decline in TVL at Solana does not necessarily reflect the state of the network. In fact, recent developments underscore the network’s commitment to growth. For example, the Solana Network has just embraced QCAD, a platform developed by Stablecorp.
This development will provide global accessibility to FX trading pairs and at 90% lower costs than traditional exchanges.
Stablecorp is extremely excited to announce that QCAD is LIVE @solana ! Users around the world can access currency pairs like QCAD/USDC on Orca at 90% lower costs than foreign currencies in traditional locations. PR here: https://t.co/1DZamaSoqU
—Stablecorp Inc. (@stablecorp) September 22, 2023
The development highlights growth opportunities thanks to projects operating on the Solana network. Solana has achieved a significant recovery in development activity over the past two weeks. However, volume remains subdued, reflecting sluggish market conditions across the board.
Read more about the Solana price forecast for 2024
Solana volume and development activity
The state of SOL’s on-chain volume is important given the latest price action. The cryptocurrency is struggling to maintain bullish momentum despite recently breaking its bearish resistance.
SOL was exchanging hands at $19.60 at the time of writing. The country now risks capitulating if the market fails to manifest significant demand in the coming days. On the other hand, the stock is still trading at a significant discount to three-month highs.
Source: TradingView