Solana experienced a significant drop in revenue in the last quarter, despite a surge in price, as interest in Solana NFTs declined.
Solana (SOL) has gained considerable attention in recent months due to its growing popularity among users. However, the network faced challenges during the first quarter of 2024.
Mixed Financial Performance of Top Blockchains in Q1 2024
A review of the financial performance of leading blockchains in the first quarter of 2024 revealed a diverse range of results. Ethereum (ETH) emerged as the top performer, boasting a profit of $369 million, followed by Tron (TRX) with $71.8 million in profits.
On the positive side, BNB Chain also recorded a profit, albeit at a smaller scale, amounting to $6.6 million.
However, Solana and Bitcoin (BTC) faced significant losses during this period. Solana reported losses of $796 million, while Bitcoin suffered a staggering loss of $4.5 billion.
Impact of Declining Activity on Solana Network
At present, the Solana network is experiencing a decline in daily active addresses. Over the past few weeks, the number of daily active addresses has decreased from 2.4 million to 1.1 million.
Moreover, there has been a notable decrease in the number of daily transactions on the Solana network. Data from Artemis indicates that the number of transactions has dropped from 40 million to 19 million in recent days.
This decline in network activity raises concerns about Solana’s future revenue generation potential, as lower activity levels may hinder the protocol’s ability to generate revenue in the long term.
Challenges in Solana’s NFT Sector Amid Price Resilience
A closer look at Solanafloor data revealed a decline in interest in blue-chip Solana NFT collections, indicating a struggle in the NFT sector on the Solana network. This decline suggested that users were diverting their attention to other activities such as decentralized exchanges (DEXes) or meme coins rather than engaging with Solana NFTs.
Despite the challenges faced in the NFT sector, SOL’s price remained relatively robust. At the time of reporting, SOL was trading at $151.27, marking a 4.87% increase in the last 24 hours.
However, it’s worth noting that the trading volume of SOL had decreased by 34.85% during the same period. This decline in trading volume could potentially pose challenges for SOL’s price trajectory in the future.
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