There is no compelling evidence that Solana will surpass Ethereum as the preferred blockchain for institutional investors. This view was expressed by experts from the Swiss crypto bank Sygnum.
According to the report, current sentiment around Ethereum “remains poor.” The market is mainly focused on “the large transaction volumes of Solana and its recent dominance in fee generation.”
“Setting aside sentiment, we believe that medium-term prospects will primarily be determined by the choice of platforms on which traditional financial institutions offer their products,” stated Sygnum.
Experts argue that Ethereum’s advantages include “security, stability, and longevity,” as well as higher revenue. In fact, the network outpaces Solana by nearly 2.5 times in this regard. An exception was a brief period related to the issuance of tokens by Donald Trump’s family, TRUMP and MELANIA.
“The market has always viewed Solana’s revenues as less stable, as they are largely concentrated in the meme coin sector. This will limit its superiority,” emphasized Sygnum specialists.
Ethereum faces criticism for stagnant on-chain activity on its base blockchain—the Dencun hard fork sharply reduced L2 network costs, where transaction volumes have shifted. This has led the market to consider ETH less valuable, experts believe.
However, Solana faces a “comparable problem” in the form of tokenomics, they added. The blockchain surpasses its competitor in generating fees at the first level, but most of the fees go to validators and do not increase the value of SOL.
“At the moment, Solana does not seem inclined to increase the token’s value, as the proposal to adjust the inflation rate, which would have had the corresponding effect, was recently definitively rejected,” noted the experts.
They pointed out that Ethereum dominates in use cases popular with governments, regulators, and financial institutions: tokenization, stablecoins, and DeFi.
The blockchain’s share in the RWA segment reached 57%, while the L2 protocol ZKsync accounts for another 20%. Solana’s figure does not exceed 3%.
“Although Ethereum’s share of the stablecoin market has declined since the beginning of the year, it still exceeds 50%, while Solana, although it has doubled its market share, remains just above 5%,” experts noted.
They found Solana’s progress in decentralized finance most convincing. In terms of TVL, the blockchain has increased its segment percentage from 9.5% to 11.5% since the beginning of the year. Ethereum’s figure has decreased from 63.5% to 55%.
“So far, all ‘Ethereum killers’ have failed to challenge the network’s dominance, and despite some of these projects bringing brilliant innovations to solve real problems like scalability or interoperability, most have faded away by now,” concluded Sygnum specialists.
Back in December 2024, Ethereum researcher Max Reznik stated that the project was “tired and burnt out,” and announced his departure to the Solana company Anza.
Conversely, one of Ethereum’s core developers, Justin Drake, dismissed the threat to the blockchain’s position from competitors like Solana.