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Amid a broader cryptocurrency market slump, Solana distinguishes itself with a remarkable 43% surge against the U.S. dollar in a week, fueled by a frenzy over new memecoins and surpassing Ethereum's trading volume. This surge has catapulted Solana's market capitalization, making it one of the crypto market's standout performers.
Solana Eclipses Ethereum in Trading Volume Amid Memecoin Mania, Faces Scalability Hurdles
Over the weekend, Solana network activity surpassed Ethereum in a scramble for Solana-based memecoins, causing the network to struggle to keep up.
According to DefiLlama, Solana's total trading volume surpassed Ethereum on March 16, reaching $3.52 billion and outpacing the Ethereum network's daily volume by more than $1.1 billion.
Despite its impressive growth, the Solana network has faced some challenges. As the network activity surged, many users experienced transaction issues, including frequent failed or missing transactions. This underscores the need for the network to adapt and scale to meet the growing demand.
During the network's struggle peak, Solana's ping time was between 20 and 40 seconds at 8 p.m. UTC on March 16. This led to a significant number of transactions, approximately 50%, failing for about 20 minutes. This incident highlights the importance of network stability and scalability in the cryptocurrency market.
A voracious appetite for new meme coins fueled the massive increase in Solana network activity. On March 14, degens began investing in Book of Meme (BOME), a new memecoin that rose from near-zero to a market capitalization of $1.45 billion in just 56 hours.
Another memecoin known as "$NAP" (NAP) attracted significant attention from traders, rising from a market capitalization of around $20 million to more than $330 million in less than 18 hours.
Solana's price has risen in tandem with the significant increase in network activity. According to CoinGecko data, SOL is now trading at $200, up 7.6% in the last week and 38.4% in the last month.
Solana's recent gains have also enabled the coin to overtake Binance's BNB coin to become the fourth-largest cryptocurrency by market cap at $88.5 billion.
Solana's Market Cap Soars as Trader Nets Big on Memecoin, Misses Out on Larger Gain
Because of an overall increase in the total supply of Solana tokens, the network's market capitalization is now nearly $12 billion higher than its previous high of $76.5 billion, reached on November 7, 2021.
On March 14, blockchain analytics firm Lookonchain flagged an impressive trade in which a Solana holder with the wallet address "shatter.sol" invested 50 SOL in a new Solana memecoin called Book of Meme (BOME).
After their value increased, the trader purchased approximately 170 million tokens and sold them for $131,000. While many consider the trade outstanding, the token's price skyrocketed even higher. According to Cointelegraph, CoinGecko BOME's price increased from $0.00005848 on March 14 to $0.005833 on March 15.
This increased the token's market capitalization to more than $320 million, implying that the 170 million tokens would have been worth approximately $993,000 had the trader waited a day before selling.
Photo: Shubham's Web3/Unsplash
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