After a period of explosive growth driven by memecoins, Solana (SOL-USD) stands at a critical crossroads. Despite an increasingly favorable regulatory environment for cryptocurrencies in the U.S.—marked by the White House’s announcement of a “Strategic Bitcoin Reserve,” dismissals of lawsuits across the digital asset industry, and the OCC reaffirming that national banks can custody crypto assets and engage with distributed ledger technology—market reactions have been tepid. Stagnant prices and receding speculative sentiment seem to confirm the old adage: “Buy the rumor, sell the news.” In this wave of “de-bubbling,” Solana’s “memecoin factory” narrative faces a severe test.
Memecoin Fade: Solana’s Growth Engine Stalls
At the beginning of 2024, Solana quickly became the star of the crypto market, fueled by the explosive rise of the “memecoin factory” platform pump.fun. From January to November, its daily active addresses (DAA) surged from 695,000 to 6.7 million, and transaction fees briefly surpassed those of Ethereum (ETH-USD). The wealth effect of memecoins brought a flood of users to Solana’s ecosystem. However, this frenzy did not last. As the market grew weary of memecoins like “dog coins” and “cat coins,” which lack real utility, Solana’s DAA peaked in November 2024 and has since declined, dropping to 5.3 million by February 2025—a 21% decrease from the peak. Meanwhile, transaction fee revenue plummeted from 120millioninJanuaryto85.2 million in February, a nearly 30% drop. The data clearly indicates that Solana’s memecoin narrative is nearing its end.
This trend aligns with the broader decline of the memecoin sector. As of March 2025, the memecoin segment of the crypto industry has fallen by 54% year-to-date, joining “AI coins” and “GameFi” as some of the hardest-hit areas. In contrast, sectors with real-world use cases—such as real-world asset tokenization (RWA), privacy coins, and exchange tokens—have shown resilience. This divergence underscores a harsh reality: as the market shifts from “casino culture” to focusing on fundamentals, memecoins lacking practical value will inevitably be abandoned. As the biggest beneficiary of the memecoin craze, Solana must now confront the growing pains of ecosystem transformation.
Ecosystem Data Concerns: Structural Contradictions Behind High Growth
Although Solana’s on-chain stablecoin supply has surged from $1.8 billion at the beginning of 2024 to $11.8 billion at present, there is a hidden crisis behind this glamorous data. According to Artemis data, Solana’s market share in stablecoin transfer volume dropped sharply from 35% in January to 9% in March, as it was eroded by competitors such as Coinbase’s public chain Base (COIN). This exposes a key contradiction: although Solana can attract capital deposits, it has failed to effectively activate the circulation scenarios of its stablecoins. In other words, a large number of stablecoins are still in the “hoarding” stage, rather than being used for actual applications such as payment, cross-border remittances or DeFi.
This contradiction is further reflected in the changes in user behavior. Although Solana was once regarded as a disruptor of traditional payment giants such as Visa and Mastercard due to its ultra-low transaction fees (less than 1 cent per transaction) and instant settlement, its on-chain activity is highly dependent on meme coin speculation. When the meme coin craze subsided, Solana has not yet found an alternative application of the same magnitude. Taking the NFT market as an example, although Solana’s NFT sales briefly rebounded in 2024, they fell into a slump again in 2025, with monthly sales of less than US$50 million, only one-tenth of Ethereum. Although the DeFi sector ranks second with a total locked value (TVL) of US$6.7 billion, it is still far behind Ethereum’s US$42 billion. Solana’s “infrastructure advantage” has not yet been translated into sustainable ecological prosperity.
Valuation Dilemma: Can Low P/F Ratios Support Future Expectations?
From a valuation perspective, Solana’s price-to-fee ratio (P/F) has risen from 25x in November 2024 to 88x, even as the price of SOL has fallen by 35% year-to-date. This “divergence” reflects investors’ mixed sentiments: on one hand, they recognize Solana’s technical potential; on the other, they worry about its lack of new narratives to drive growth. Compared to competitors like Aptos (APT-USD) and Near (NEAR-USD), Solana’s valuation remains low, but this is more a symptom of its memecoin dependency than a sign of undervaluation.
A cautionary tale is Ethereum’s post-merge performance in 2023—while deflationary mechanisms drove up its price, shrinking on-chain activity led to a valuation bubble burst. For Solana, the memecoin fade has forced the market to reassess its fundamentals. If the ecosystem cannot incubate the next “killer app,” any rebound in SOL’s price may stem from market sentiment rather than value discovery.
Path to Transformation: Can Stablecoins Become Solana’s New Pillar?
Facing the challenge of a fading memecoin narrative, Solana’s key to breaking through may lie in deepening its stablecoin ecosystem. Currently, its on-chain stablecoin supply accounts for 5% of the total market, far surpassing competitors like Polygon and Avalanche. If Solana can transform stablecoins from “hoarded assets” into “circulating mediums,” it could open new frontiers in cross-border payments, corporate settlements, and other real-world use cases. For example, by integrating more fiat on-ramps, developing compliance tools, and expanding merchant partnerships, Solana could leverage its technical advantages to capture market share. Additionally, collaborating with stablecoin issuers like Circle and Tether to develop on-chain financial products could reignite DeFi growth.
However, this transformation is not without challenges. Coinbase’s “internal funneling” strategy through Base is rapidly capturing stablecoin market share, while traditional giants like Visa and PayPal are exploring their own blockchain solutions. To break through, Solana must address two core issues: first, lowering user barriers to entry, and second, building differentiated use cases. For instance, developing low-cost cross-border payment protocols for small businesses or partnering with social media platforms to launch embedded stablecoin wallets. These initiatives require time, and the window of opportunity for Solana may be narrowing.
Conclusion: Short-Term Pressure, Long-Term Potential Remains
Although the memecoin fade has left Solana facing short-term growth bottlenecks, its high-performance infrastructure and active developer community continue to underpin its long-term value. From a technical perspective, Solana’s parallel processing capabilities and low-latency features give it unique advantages in payments, high-frequency trading, and other scenarios. From an ecosystem perspective, its stablecoin and DeFi foundations provide ammunition for transformation. However, in an increasingly competitive blockchain landscape, Solana must prove it is more than a “memecoin playground”—it must become a cornerstone of the “value internet.”
For investors, a “hold” rating on SOL may be the most rational choice—avoiding the temptation to chase highs during the ecosystem transition while not dismissing its technical potential due to short-term pains. After all, the history of the crypto market repeatedly shows that blockchains that truly endure are those that create real value, not those reliant on single narratives. Solana’s next chapter will determine whether it can evolve from the “King of Memecoins” to the “King of Value Networks.”
