Decentralized exchanges (DEXs) on the Solana network are now achieving price discovery that often matches or even surpasses that of major centralized exchanges (CEXs) like Binance and OKX. This competitive shift comes despite a stark 90% drop in overall DEX trading volumes on Solana since October 2024, highlighting a structural evolution in on-chain liquidity.
The primary driver behind this improved pricing is the rise of proprietary automated market makers (Prop AMMs). These are specialized liquidity pools that operate at specific price ranges, offering more efficient trading and deeper market depth. Data from Dune Analytics indicates that over the past month, Prop AMM exchanges have taken a leading role, compensating for lagging volume from other DEXs and making the space more competitive.
However, this efficiency is not uniform across all trading venues. Wrapped Solana (wSOL) tokens on other blockchains, including Ethereum, Base, and BNB Chain, trade within a vastly different and often inefficient price range, fluctuating between $95 and $102 depending on the chain. These markets suffer from extreme illiquidity and incur additional trading and bridging costs, limiting arbitrage opportunities.
Amidst this, a significant pool of capital is being unlocked. Jupiter, a leading Solana-based platform, recently introduced a tool called "Native Staking as Collateral" on Jupiter Lend. This innovation allows the over $30 billion worth of natively staked SOL—previously locked out of DeFi—to be used as liquid collateral without exiting staking positions. This enables validators and large holders to access liquidity while continuing to earn block rewards and fees, potentially vitalizing DeFi activity on Solana.
The news also sheds light on the behavior of major holders. Treasury entities currently hold over 20 million SOL, with holdings remaining stable for months and approximately 50% of these funds staked. This suggests a holding pattern rather than selling pressure, even as SOL trades at a higher baseline than in previous cycles, raising questions about potential future liquidations by whale holders.
