Solana (SOL) TVL surpasses the entire Ethereum layer-2 ecosystem

Solana's $10.9 billion TVL surpassed the entire Ethereum layer-2 ecosystem.Solana's 30-day fee revenue ($43.4 million) rose 109% compared to the previous month.

Solana's (SOL) price surged 24.8% between May 6 and May 10, following the broader altcoin market rally after Bitcoin (BTC) broke above $100,000. Afterward, SOL struggled to stay above $180, but derivatives and onchain data still suggest further gains are in store.

While Solana ranks the fifth largest cryptocurrency by market capitalization, Solana Network is the vice-leader in key onchain metrics including the total value locked (TVL).

Solana's $10.9 billion total value locked (TVL) surpasses the entire Ethereum (ETH) layer-2 ecosystem, which includes Base, Arbitrum, and Optimism. Even BNB Chain, which integrates seamlessly with Binance and Trust Wallet, cannot match Solana's numbers.

Solana saw notable 30-day TVL increases in Raydium DEX (78%), Jito liquid staking solution (41%), and Marinade (56%).

Rising fee revenue boosts SOL demand and momentum

Gaining traction in decentralized finance (DeFi) does not always translate into demand for the native token, as some networks have extremely low fees. For example, over a recent 30-day period, the Ethereum network generated just $24.9 million in base layer fees, while Tron (TRX) captured $51.9 million and Solana totaled $43.3 million, according to DefiLlama.

Solana's DApps revenues and chain fees have shown consistent growth over the past four weeks. The latest figures are approaching their highest levels in three months, which is highly positive for SOL, as it drives demand. With 65% of the SOL supply involved in staking, this dynamic also supports upward price momentum.

Related: Solana co-founder proposes meta chain to fix blockchain fragmentation

To gauge whether traders are becoming more optimistic about SOL's price outlook, it is helpful to look at leverage demand. A positive funding rate means that long positions (buyers) are paying to keep their trades open.

Currently, the SOL perpetual futures funding rate is at 8%, which falls within the neutral range of 5% to 10% based on the cost of capital. However, with SOL still trading 40% below its all-time high of $295 from Jan. 19, there is little reason for excessive optimism just yet.

Still, the increasing activity on the Solana network suggests that SOL could reach $200 soon, potentially outperforming its competitors.

The exact catalyst that could propel SOL's price higher remains uncertain, but possibilities include the potential approval of a spot Solana exchange-traded fund (ETF) in the US, as well as Solana's eventual inclusion in a state-level digital asset strategic reserve. Additionally, some analysts are optimistic about traditional asset tokenization on Solana, which could unlock further value for SOL.