Solana (SOL) is demonstrating a powerful divergence between its recent price performance and its fundamental network strength, attracting significant institutional capital while leading major blockchain competitors in key metrics. Despite a 30% price pullback over the past month, with SOL trading around $82 and showing no immediate signs of a bullish reversal, institutional conviction remains notably strong.
This is evidenced by Solana Exchange-Traded Funds (ETFs), which have seen $2.39 million in net inflows, extending a positive streak to six days. This trend starkly contrasts with Bitcoin (BTC) and Ethereum (ETH) ETFs, which have continued to experience outflows throughout February. Analysts note that Solana ETFs, being newer and staking-enabled, have less historical baggage and offer buyers discounted entry points for passive income.
Fundamentally, Solana is outperforming its Layer-1 (L1) peers. The network currently generates the highest 24-hour decentralized application (DApp) revenue at $3.43 million, surpassing Ethereum, BNB Chain, and Tron. More impressively, Solana's capital efficiency has surged. Its app revenue capture ratio—measuring revenue generated per dollar spent on network fees—jumped from 262% to 375% last quarter. This means for every $1 in fees, DApps on Solana are pulling in $3.75 in revenue, indicating robust monetization and developer activity even in a cooler market.
Furthermore, Solana has sprinted ahead to secure the top position for payment volumes among major blockchains. This lead is maintained despite a cooldown in overall network activity, with daily active addresses declining from a peak above 3.2 million in early February to around 2 million. A key driver is PayPal's selection of Solana as the primary rail for its PYUSD stablecoin, leveraging the network's low fees and high throughput.
While the market sentiment remains bearish, with prediction platform Polymarket indicating an 81% chance SOL could test the next major support near $60, the combination of strong institutional flows, leading revenue generation, and superior payment volumes suggests smart money is building a long-term bullish case for Solana's ecosystem.
