Solana on-chain revenue hits 18-month low, SOL may test $80 level

Gate News, March 20 — The Solana ecosystem has recently come under pressure, with on-chain data and derivatives markets simultaneously signaling a bearish outlook. After reaching $97.70 on Monday, SOL has continued to decline, dropping about 11% over three days, briefly falling to $87. During this period, approximately $25 million in leveraged long positions were liquidated, indicating a clear weakening of market sentiment.

Derivatives indicators show a lack of bullish confidence. The funding rate for SOL perpetual contracts is close to zero, well below normal levels, reflecting a significant decline in leveraged long demand. Meanwhile, put option premiums are rising, and delta skew has increased to 12%, suggesting professional traders are more hedging against downside risk, which may imply further testing of the $80 level.

On-chain fundamentals are also weakening. Solana DApp revenue has fallen to about $22 million, hitting an 18-month low, down sharply from $36 million two months ago. While this trend is somewhat common across the industry, cooling demand continues to exert downward pressure on SOL.

In specific sectors, although Solana projects like Pump, Raydium, and Orca maintain leadership in decentralized exchange trading volume, they face fierce competition in the perpetual contract space. Dedicated derivatives chains like Hyperliquid hold over 80% of the market share, diverting capital flows.

Additionally, new on-chain products are changing the funding landscape. The launch of S&P 500 index perpetual contracts on Hyperliquid offers new trading tools for non-U.S. users and has driven the tokenized stock market to nearly $1.1 billion, which somewhat weakens demand for the SOL ecosystem.

From a valuation perspective, SOL’s current market cap is about $51 billion, trading at a significant discount to BNB, but its total value locked (TVL) and network fees remain competitive. However, many companies holding SOL as a core asset are currently at unrealized losses, further dampening market sentiment.

Analysts believe that, given the still-weak on-chain activity and bearish derivatives market, SOL is likely to remain range-bound and weak in the short term. Breaking through the $110 resistance level will require more capital and demand support. (Cointelegraph)