Solana as a blockchain protocol is in distress as the activities onchain are reducing, directly impacting the SOL generated as transaction fees, a metric to measure network health.
For the first time since September 2024, the total transaction fees generated on the Solana (SOL) network have fallen to their lowest level. As of last week, this index stood at just 53,800 SOL. This decline has had a negative impact on the price of the popular coin.
Epic Solana Fee Slump
Out of the 53,800 SOL, 77% came from non-vote transaction fees generated by users trying to speed up their transactions by “tipping” network validators to prioritize them. It is worth noting that this decline has been gradual, with every week worse than the previous. For example, the figure recorded last week was 10% lower than the week before.
The current level reflects a slight improvement compared to the average weekly decline of 25% observed throughout the last six weeks.
After hitting an all-time high (ATH) of 361,000 SOL in the last week of January, Solana’s weekly generated transaction fees have suddenly dropped by 85%. When it recorded this ATH, it was the same week that the crypto industry welcomed TRUMP and MELANIA.
Coincidentally, Solana validators were able to pull $25 million in fees during this time. Apart from the current decline in the value of total transaction fees on Solana, the network has equally recorded a significant plunge in the number of active addresses. Precisely, the 7-Day Moving Average (7DMA) of the number of active addresses has gone lower by 35% this period.
Solana Price Performance and Outlook
Solana’s price went from trading above $200 in January to trying to hinge to a support level. At the time of this writing, SOL traded at $120.79 following a 4.63% price dip. So far in 2025, it has recorded approximately a 50% dip, leaving investors and traders with huge losses.
The network’s present-day outlook is far from the predictions that had gone before it. At one time, when the broader market fell into a bear sentiment, SOL maintained its position on the green line, which made investors optimistic about its potential. Analysts and market watchers hinted at the possibility that it will lead to a new memecoin rally.
While this is not Solana’s present-day reality, the altcoin could see some improvement in the coming days.
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