- Solana adopts points-based reward programs to incentivize DeFi engagement.
- Despite TVL growth, concerns arise over declining DEX volumes.
- Visa collaboration fuels optimism with increased USDC activity.
In the fiercely competitive DeFi sector, Solana [SOL] has recently encountered challenges in establishing a robust presence. In response, the network has embarked on various strategies aimed at attracting a more extensive user base, particularly within the realm of DeFi.
Incentives for User Engagement
One notable strategy involves the implementation of points-based reward programs across several Solana DeFi protocols, including MarginFi, Cypher, Solend, and the latest entrant, Jito. These programs serve the purpose of quantifying and acknowledging user contributions to the protocols, encouraging active participation in Solana’s DeFi offerings.
Seeking Further Enhancements
Another key indicator of Solana’s potential for a brighter future is the increasing Total Value Locked (TVL) on the Solana network. According to Artemis’ data, Solana’s TVL has risen from 296 million to 313.75 million in recent weeks.
However, despite this recent surge in Total Value Locked (TVL) within the Solana ecosystem, there has been a noticeable decline in Decentralized Exchange (DEX) volumes. These DEX volumes are pivotal to the vitality of a DeFi network, and the drop in DEX activity has raised concerns about the health and future prospects of Solana’s DeFi landscape.
Data from Token Terminal further underscores these challenges, revealing a 14.5% reduction in fees and revenue generated by the Solana protocol. This decline emphasizes the need for additional development efforts and strategies to enhance user engagement and adoption within Solana’s DeFi space.
Rising Stablecoin Volumes
Solana’s collaboration with Visa, however, has injected a fresh wave of optimism into the ecosystem. This strategic partnership has led to a significant increase in USDC activity on Solana, resulting in a substantial uptick in daily transfer volumes. Moreover, it has attracted heightened interest from major investors, often referred to as whales. This collaboration has positioned Solana to strengthen its position in the DeFi sector by providing efficient payment solutions and attracting a broader user base.
Solana and Visa announced their blockchain alliance a few weeks ago
I’ve gathered information about the chain effect, particularly the USDC activity, in relation to the news
🔥Even if the market is in a bear market, the impact of news can be seen.
— h4wk (@h4wk10) September 25, 2023
Despite these commendable efforts and collaborations, Solana’s native token, SOL, has experienced a decline in price over the past month, with SOL trading at $19.337 at the time of writing. Nevertheless, the increased trading volume of SOL indicates ongoing interest and activity within the network.
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