A Shift in DeFi Space: Solana, the "ETH" Killer?
Marc Schaefer @unsplash

A Shift in DeFi Space: Solana, the "ETH" Killer?

By Crey22 | Earning free crypto online | 11 Sep 2021


Solana did this little thing: price shot up over 370% in the past four weeks, from US$ 38 on August 11th to a whopping US$ 192. Less supply, more demand: what are the folks doing with all their Solana? 

According to StakingRewards the big portion of the circulating supply is still being staked. Longterm holders believe in even a higher price. The rest of tokens are in holding, trading and obviously: invested in DeFi. And with Solana being more valuable, there are signs that Ethereum is losing to Solana - in parts. 

Okay. There was this massive hard fork "London" upgrade on Ethereum at the beginning of August. Me mini-shrimp was hoping for a substantial reduction of gas fees for any transaction on Ethereum. But I didn't see any. In fact there is no change, have seen volatile 70 to 400 Gwei and the 400 Gwei just when it was really important to do something with ETH - of couse. Maybe gas fees will see drastic reductions soon? Like in 12 months or so? For the moment Gas fees have stabilized at a rather higher range as seen on YCharts:

YCharts

 

Most probably I'm not the only mini-shrimp who is disgusted to pay US$ 50 for a transaction or US$ 100 for a smart contract call and then get in panic mode if I see a MetaMask error or wait 15 min. anxiously in front of the screen: Better invest the US$ 50 in an affordable blockchain DeFi project: Solana, faster, cheaper?

A short check on Defi Lllama reveals not only that Solana has secured a solid top 3 position among blockchains ranked by Total Value Locked (TVL), but Ethereum has lost more than 22% in TVL in the past seven days. On the other hand Solana has gained 155% in that period, which relates to the higher US$ value, but ETH lost volume. Shrimps are moving to other chains.

 

Top 10 Blockchains by DeFi TVL

 

A further look into the TVL ranking of DeFi protocols on Solana reveals that newcomer Sunny Aggregator has blasted to top 2 with a whopping US$ 3 bn in value.

Oh boy, I remember that I played around on Sunny's devnet. Just a few weeks ago they launched mainnet and activate more liquidity pools each day. Sunny is a composable DeFi yield aggregator. What they do is, take your liquidity pool tokens from the Saber pools and reward you with the Saber tokens plus the $SUNNY governance token. For that they charge you with a whopping 16% "performance fee" - which is huge, but compensated if $SUNNY's price gets higher. 

But this is astounding: team is anon. Code not audited. Sounds all risky, but they achieved US$ 3 bn in somewhat like four, five weeks - which also helped boosting Saber's TVL of course. Incredible. 

Solana is cool. It's fast and transaction are supercheap compared to ETH. Is it stable and scalable as proclaimed? I dunno, but Solana is not the only potential "ETH killer" in the wild. There is tons of stuff happening on the other blockchain universes. 

The Cosmos ecosystem is about to massively grow - as it kicked off its season with Osmosis, Esmeris - the Internet Blockchain Communication (IBC) will drive growth for all Cosmos-based blockchains, especially with the coming of Terra's stablecoin UST. Terra seeks more adoption with more than 70 protocols in the pipeline. 

Avalanche, Polygon, Fantom and smaller mcaps like Icon, Zilliqa, Harmony, Near etc. are set to expand as well in DeFi and NFT space. 

And the Polkadot-Kusama duo is not there to kill ETH, but builds bridges to ETH via EVM integrations.

 

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Crey22
Crey22

A crypto noob shares his experiences in crypto with noobs. What can go wrong?


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