Solana Extends Decline as Network Activity Slows and Rival Chains Gain Ground

Solana remained under pressure as network activity slowed and competition intensified, according to a May 19 report by Cointelegraph.

The token has fallen about 15% since failing to break above $98 on May 11. It retested the $83 level on May 19, while funding rates in the futures market turned negative.

Funding rates for Solana perpetual futures are now around -3%, down sharply from +8% over the previous weekend. In a neutral market, the metric typically stands near +9%, suggesting demand for short positions has risen recently.

On-chain data also showed a slowdown across the Solana ecosystem. Weekly trading volume on Solana-based decentralized exchanges, or DEXs, is now about $11 billion, down about 56% from the January average of $25 billion.

Weekly revenue from decentralized applications, or DApps, has also fallen to about $20 million from an average of about $35 million in January. The main revenue-generating projects in the Solana ecosystem currently include Pump, Axiom Pro, Phantom and Jupiter.

Cointelegraph also cited the rise of rival chains such as Hyperliquid and Base as a headwind for Solana. Hyperliquid has been rapidly expanding market share with its native perpetual futures trading feature, while Base has been leveraging its ties to the Coinbase ecosystem.

Still, Solana remains the second-largest blockchain by total value locked, or TVL, at about $5.9 billion, behind Ethereum. Major TVL projects include Jupiter, Kamino, Sanctum and Raydium.

Solana was trading at $84.19 on Binance's USDT market, down 1.62% from a day earlier.