Memecoins: From Growth Engine to Achilles Heel
Solana experienced explosive growth thanks to the craze for memecoins like BONK, WIF, and POPCAT. These tokens generated astronomical transaction volumes and attracted millions of users. The network regularly displayed more than 6,000 transactions per second, even surpassing Ethereum on certain activity metrics.
But this medal has its flip side. The massive speculative activity of memecoins has saturated the network, leading to repeated congestion and transaction failures. Developers of serious DeFi applications began expressing their frustrations with an ecosystem dominated by short-term speculation.
The 97% drop in network activity coincides with the collapse of the memecoin market in early 2025. Indeed, Solana traders have decreased by 80-90% since late 2024.
A Technical Architecture Under Scrutiny
Beyond memecoins, Solana’s persistent technical issues fuel skepticism. The network has suffered several major outages since its launch, with the longest lasting 17 hours in 2022. These service interruptions have tarnished its reputation among institutional investors.
Solana’s very design prioritizes speed and low costs at the expense of decentralization. The network has approximately 1,900 validators, a respectable figure but geographically concentrated. The high hardware requirements to run a full node limit accessibility and create centralization risks.
The comparison with Ethereum is inevitable. Despite its higher fees, Ethereum offers stability and decentralization that reassure institutions. Solana must prove it can maintain its performance while resolving its structural flaws.
SOL Price Reflects the Prevailing Uncertainty
The SOL token has lost more than 60% of its value since its peak at $260 last November. It now hovers around $124, regularly testing crucial technical support levels.
The 2-week chart shows bearish CVD divergences since late 2024. The support at $111 appears to be the most important level to maintain. A weekly close below this level would bring SOL back to $57, representing a drop of more than 50%.
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