Is Solana Facing Its End? 97% Decline in Network Activity Sparks New Debate

In the fourth quarter of 2025, Solana experienced a remarkable 97% drop in network activity, closely followed by a decline in the price of SOL. The number of active traders plummeted from over 30 million at the end of 2024 to fewer than 1 million in 2025. This significant decrease has led some analysts to question whether it is “over for Solana.”

Key Takeaways

Solana's network activity has plummeted by 97% in Q4 2025, leading to a drop in SOL's price.
The number of active traders decreased from over 30 million to under 1 million in 2025.
Memecoins have been crucial for driving traffic but pose short-term risks for SOL's price.
Solana's annual revenue in 2025 was significantly lower than Ethereum's, raising concerns about its market position.
Predictions for SOL's price vary, with some analysts expecting potential declines while others anticipate a possible rise.

Solana Source: Dune

The decline in trading volumes towards the end of 2025 reflects a broader market trend, as Bitcoin’s price also fell by over 30%. However, Solana’s situation is a bit more complex.

The Role of Memecoins in Solana’s Ecosystem

Solana and Hyperliquid have emerged as notable success stories in the current market cycle, with SOL's price surging from $8 to nearly $300, marking an impressive 35x increase from the lows of 2022. Despite achieving relative stability and fewer network outages, the continued interest in memecoins has played a significant role in driving revenue and traffic.

During the market downturn of 2025, memecoins were notably affected. Yet, supporters like Marty Party perceive these digital currencies as a testing ground for potential real-world applications.

"Memecoin speculators have exited after a successful liveness test, but they will be succeeded by equity traders and 50 million stablecoin users. Just watch," he stated.

Nevertheless, the short-term risks related to memecoin activity have become evident, as SOL's price fell by 58%, from nearly $300 to around the $120 support level during this lull. Despite this, Solana has attracted some institutional interest, including attention from Visa for stablecoin settlements, indicating potential for network resilience if focus shifts away from gambling.

Comparing Solana and Ethereum

This decline may help Solana narrow its revenue gap with Ethereum, which currently holds a strong position in terms of institutional adoption. In 2025 alone, Ethereum has generated over $1.4 billion in annual revenue, compared to Solana's $502 million, representing a staggering threefold difference. Notably, Solana saw revenue of $2.5 billion in 2024, suggesting a fivefold drop this year.

Anatoly Yakovenko describes the situation as a “crazy year,” emphasizing the uncertainty of whether open permissionless protocols can actually grow and sustain revenues.

Solana vs Ethereum Source: DeFi Dev

From an investment perspective, SOL has underperformed compared to ETH by 56% this year, a stark contrast to the 24% gains evident last year. Fundstrat has predicted that SOL’s price could drop to the $50-$75 range in the first half of 2026.

Analyst Ted Pillows, however, believes there is a potential for a 15% rise to the $134-$140 range, pointing to a significant $1 billion in upside liquidity from leveraged shorts.

Solana price Source: CoinGlass

Conclusion

As Solana navigates these challenges, its future remains uncertain. The significant decline in network activity and price warrants close observation, especially as the broader market dynamics continue to evolve.