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Ethereum Vs Solana

Solana Surges as Galaxy Digital Dumps $100M ETH Amid Meme Coin Boom

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  • Galaxy Digital swapped $105 million in ETH for Solana over two weeks, as Solana gained traction in meme tokens and DEX activity while Ethereum declined by 20%.
  • In the past three months, Solana has surpassed Ethereum in DEX trading volume amount and number of active users, showing that more people are using Solana and its ecosystem is getting stronger.

Solana has received nearly $105 million worth of Ethereum from Galaxy Digital, one of the leading crypto asset manager, in a strategic move due to the recent increase in the popularity of meme coins and the rapid growth of decentralized exchanges on the network.

According to on-chain data from Arkham, Galaxy Digital moved a large amount of Ethereum from their wallet to Solana over the past two weeks, mostly using Binance for the transfers. The data showed that the firm swapped 65,600 ETH worth around $105 million and received about 752,240 SOL, valued at roughly $98.37 million.


The company made this move after the price of Ethereum fell by 20% in a month and Solana went up by 8%. After the swap, it was recorded that Galaxy had 55,760 ETH left and 171,250 SOL. The timing suggests that Galaxy likely sees Solana as a stronger asset with more users, lower fees, and daily growing activities.


Solana Surpasses Ethereum in DEX Volume


In the last month, Ethereum has continually struggled with its falling price and slow network activities. An analysis from dune.com properly highlights this shift, showing that the decentralized exchange (DEX) volume on Solana passed $395 billion in the last three months, compared to Ethereum, which sits at $364.65 billion.

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Solana Surges as Galaxy Digital Dumps $100M ETH Amid Meme Coin Boom 2


Solana is also leading with a little over 224 million active addresses, while Ethereum and its Layer-2 networks have just over 79.04 million combined. Following this recent change, the price of ETH has dropped again to the $1,600 range, showing more possible liquidations. Meanwhile, SOL climbed back to $140, with expectations of it growing as its on-chain activity rises.

The activities on Solana have also grown thanks to Pump.fun and PumpSwap, the new exchange launched by the platform.

Solana Vs. Ethereum: Why Solana May Struggle As A Global Blockchain Backbone

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  • Solana’s architecture limits it from achieving the decentralization needed for a global backbone.
  • Ethereum leads as the financial backbone, dominating Layer 1 as a base for L2 solutions.
  • High bandwidth needs and centralized ownership hinder Solana’s scalability potential.

Ryan Berckmans gave an outlook on Solana’s capability to transition to a global blockchain network while Ethereum is already clearly defined in this role. In a recent X post, Berckmans pointed out that Ethereum is well-placed to become the financial backbone of this new architecture, and that SOL has some significant challenges to overcome if it is to succeed in its goal of being the go-to layer for L2 solutions.

These events have made Ethereum’s “backbone” approach the dominant model for Layer 1 protocols in supporting global financial applications. Since the company’s shift four years ago, Ethereum has transformed into the base layer for L2 solutions and dApps.

Solana’s Limited Scope

It takes advantage of a strong architecture to function as the backbone of a growing blockchain environment. He stated that Solana has performed quite well in specific areas such as DeFi and meme tokens, but it does not have the versatility of Ethereum and cannot be regarded as a universal solution, he said.

Solana has recognized the L2s model as a distinct scaling strategy that Berckmans says has become the standard among large companies and governments exploring the use of blockchain. In the beginning, the project was focused on the “monolithic” structure, which. SOL’s fast and low transaction fees were the main features of the chain, however, the term integrated has been used as the second layer solutions have been increasingly popular.

Challenges in Solana’s Growth

Despite Solana’s attempts to adapt, Berckmans argued that five primary constraints limit its potential to replicate Ethereum’s role:

1. Lack of Client Diversity: Ethereum has four different client versions which help the network to be strong and minimize the potential risks. Despite that, SOL has only one client, which makes the network more vulnerable to potential outages and cyber threats.

2. High Bandwidth Requirements: Currently, Solana recommends having 10 Gbps upload, which in turn hampers decentralization as the network heavily relies on the data centers of large companies, and imposes restrictions in many regions.

3. Outage Risks: In comparison to ETH, Solana has a history of outages, which makes it look weak as a global financial network.

4. Centralized Ownership: Of the initial supply of SOL, the insiders own 98% of the network, which may not appear very decentralized in comparison to Ethereum; despite having a higher concentration in the hands of the public.

5. Scaling Focus Misalignment: Solana’s L1 execution specialization does not correspond to the tendencies towards zk-rollups and other L2 solutions that are currently observed in the industry, which makes Ethereum a more suitable choice for scalable dApps.

While Solana could stay relevant and survive in some niche markets, it is still far away from challenging Ethereum as the essential infrastructure of decentralized finance. The adoption of L2 is going faster and faster, and Ethereum is virtually unrivaled in the level of decentralization it offers, and the trust that underpins it for the global blockchain community.