Analysis of DeFi Project Performance in the Solana Ecosystem

Driven by DePIN and MEME coins, the overall performance of the Solana ecosystem is strong, with SOL price nearing 100 USD at one point. The DEX trading volume on Solana briefly surpassed that of Ethereum, sparking discussions about "Solana surpassing Ethereum." Meanwhile, Ethereum faces various criticisms, especially as liquidity mining DeFi projects, which led the previous bull market, are no longer favored. So, how are the DeFi projects on Solana performing? Are the old projects truly reviving?

Liquid Staking

Liquid staking is a rapidly growing project type within the Solana ecosystem. Staking itself locks up funds which benefits the appreciation of SOL prices, while various liquid staking tokens (LST) can be utilized in other Decentralized Finance projects. The wealth creation effect and incentive measures from new project airdrops also drive the continuous growth of funds participating in liquid staking.

Marinade Finance and Jito are the two largest liquid staking projects on Solana. As of December 22, their TVLs are $1.05 billion and $626 million, ranking them as the top two in the Solana ecosystem by TVL. Although Marinade's staked funds are only 57% of their peak in USD terms, the number of staked SOL (11.15 million SOL) has reached an all-time high.

Jito also provides MEV infrastructure based on staking, receiving widespread support due to an unexpected airdrop. Recently, as it began incentivizing the use of JitoSOL in DeFi projects, the amount of Jito's staking has continued to grow rapidly, currently reaching 6.42 million SOL.

Decentralized Exchange

The main projects in the DEX space are still Raydium and Orca, with no new prominent projects emerging. Both have developed centralized liquidity features based on their original foundations, but their positions have reversed.

Raydium's liquidity has dropped from a peak of $2.21 billion to $113 million, only 5.1% of its high. Orca's liquidity has decreased from a peak of $1.41 billion to $184 million, which is 13% of its high.

Recently, the DEX trading volume of Solana has surpassed that of Ethereum, attracting attention. Data shows that Solana is higher than Ethereum in both 24-hour and 7-day trading volumes. Although some have questioned the possibility of double-counting the trading volume of aggregators, when calculating the trading volume of each DEX separately, Solana still exceeds Ethereum.

Another indicator worth noting is the trading volume/TVL ratio of DEX, which reflects the utilization of funds. Raydium and Orca are at 4.81 and 2.87 respectively, far exceeding the 0.26, 0.09, and 0.042 of major DEXs on Ethereum. This suggests that the returns from providing liquidity on Solana may be higher, potentially attracting more funds into the Solana ecosystem.

Decentralized Finance

The lending sector has seen significant changes, with the established protocol Solend still ranking high but being surpassed by new projects. Solend's TVL has dropped from a peak of $910 million to $187 million, which is 20.5% of its high point. Other established lending protocols have performed even worse, with a substantial decline in TVL.

Emerging competitors like marginfi and Kamino have performed exceptionally well, with TVL reaching 348 million USD and 204 million USD respectively, and growing rapidly. These projects have not yet issued governance tokens but have introduced point systems to attract capital influx. Various LSTs are also supported on these platforms, further promoting capital growth.

Yield Aggregator

The yield aggregator track has almost been discredited. Due to low transaction fees on Solana, the advantages of automatic reinvestment through aggregators are not obvious. The once well-known Sunny project's TVL has dropped from a peak of $3.4 billion to $4.02 million. Other projects offering lending and leveraged mining features, such as Francium and Tulip, have also performed poorly.

Perpetual Contracts

Compared to perpetual contract projects on Ethereum Layer 2, Solana performs moderately in this field. Drift is currently a stronger project, adopting an order book trading model similar to dYdX, with a TVL reaching a new high of $105 million. Mango, as an older project, has seen a significant decrease in TVL but has added perpetual contract trading. Jupiter's JLP adopts a model similar to GMX V1, with impressive trading volume.

Decentralized Stablecoin

Solana has一直缺乏突出项目 in the decentralized stablecoin space. The UXD Protocol was once valued at nearly $2 billion, but its TVL peaked at only $42 million and has now fallen to $11.19 million. Other over-collateralized stablecoin projects like Parrot Protocol and Hubble have also fallen into decline.

Summary

The development status of various DeFi projects on Solana varies. Liquid staking leads the growth of TVL, and DEX trading volume sometimes exceeds that of Ethereum, demonstrating high efficiency. Emerging lending platforms are performing well, and there is growth in the perpetual contract sector. However, yield aggregators and stablecoin projects are performing mediocrely. Overall, the Solana ecosystem is undergoing recovery and reconstruction, with both new and old projects driving the development of the ecosystem.