In a research report published on Wednesday, Coinbase revealed that the collapse of FTX in 2022 had a significant impact on the Solana blockchain’s ecosystem in terms of market sentiment. Solana was not immune to the fallout in crypto markets, but the report highlighted that the fundamental value proposition of the Solana protocol remains intact from a technical perspective.
The Solana community was stunned by the collapse of FTX, but founder Anatoly Yakovenko believed that the blockchain’s perceived linkages with FTX were overstated. The report noted that Solana is a blockchain optimized for high throughput, de minimis costs, and native scalability, representing a differentiated approach within the layer 1 landscape.
Despite the impact of the FTX collapse, Coinbase believes that Solana is well-positioned to reassert itself as a genuine layer 1 competitor. The note highlighted that Solana’s network activity with regards to transactions, users, and development remains relatively strong. In fact, activity on Solana is favorable when compared to Ethereum, suggesting that the solana (SOL) token may be undervalued relative to ether (ETH).
Furthermore, the report noted that solana’s market capitalization is only about 4.3% of ether’s, while the amount of daily active users on the blockchain represents around 43.7% of Ethereum’s daily active user base. Additionally, Solana processes around 17 times the amount of daily transactions processed by Ethereum. Overall, the report concludes that despite the challenges faced in 2022, Solana remains a formidable competitor within the layer 1 blockchain landscape.
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