Solana (SOL) has attracted more stablecoins in the past day as liquidity shifts to the most promising markets. A shift towards DeFi lending and DEX activities is driving this trend.
Solana (SOL) wants to become one of the most active chains by 2024. Solana saw a larger inflow of stablecoins in the last days of the year, surpassing all other chains. Based on data from Lookonchain, Solana attracted more than $454 million in the influx of stablecoins over the past week. Methods for tracking inflows vary, but the general trend is a more active bridging of stablecoins to Solana’s apps and credit pools.
Solana also surpassed Base despite the recent rush to AI agent tokens. Stable coin flows can shift depending on the available profit potential of different chains. Arbitrum, previously one of the major L2 chains, saw the largest outflow of stablecoins.
Solana led the day in stablecoin inflows, taking advantage of expanded liquidity in 2024. | Source: Artemis
Despite the L2 story, not all chains have succeeded in attracting value this year. Former DeFi star ZKSync Era saw net outflows of over $2 billion, along with Linea, Blast, and Avalanche.
On an annual basis, stablecoins have boosted Optimisme, Base, Solana, Arbitrum and SUI. Ethereum remained the most active chain in hosting USDT, adding to the available liquidity. General, stable coins pushed past the $200 billion mark, driven by Tether, alongside new coins for DAI, USDS and Ethena’s USDe.
Ethereum remains a stablecoin backer, traffic has shifted to Solana and Base
Stablecoin flows change in the short term and Solana reached its leading position on December 30. The chain saw $8.8 million in net flows that day, followed by SUI’s $2.9 million in net flows. Solana competes with Base for fund inflows, although it has only been in second place for the past three months.
So far, Base remains the main target for stablecoin inflows. For 2024, the chain attracted $7.8 billion in premium inflows, of which $3.5 billion was retained as net inflows.
Solana attracted $5.3 billion in new inflows while retaining $2.1 billion in net inflows year to date. The chain recently added more than USD 100 million from the Sky ecosystem as it looks to expand DeFi lending.
As a result, Solana has $5.254 billion in bridged stablecoins, with a total locked value increasing to $8.58 billion. Solana has lagged behind in attracting value, only peaking in December at over $9 billion across various tokens and stablecoins. Jito Liquid Staking and Kamino Finance locked up most of the value, but DEX, like Raydium and Jupiter, also raised $4.47 billion in their liquidity pairs.
Measuring stablecoin flows bridging activitywhich varied depending on the apps available. Arbitrum was one of the EVM-compatible chains with very active bridging. For Solana, bridging from Ethereum was rarer, but once funds were sent to Solana, they were more likely to stay. Arbitrum, on the other hand, had a much more active turnover.
The recent trend in stablecoin flows shows that traders’ expectations have changed so far this year. The trend accelerated when Solana and Base became the top chains carrying AI agent tokens. As the sole source for these tokens, bridging stablecoins for trading was key to accessing the new markets.
The Solana activity has moved from memes to DeFi
Meme tokens have been one of the main growth drivers on Solana in recent months, with two significant sets of expansion. Despite this, not all traffic on Solana was of the same quality. The chain executed multiple low-value transactions, with up to 35% failed transactions.
Over the past year, Solana has also been the leader in running trading bot activities. Routing and bot usage were critical for Solana to ensure a successful DEX transaction or token sniping.
Up to 86% of all bot traders use Solana as their destination chain. Most Solana traffic also comes from wallets with 0.01 SOL as balances. However, the influx of stablecoin activity shows that value is also being built, mostly tied to whale wallets using the protocols.
Solana’s lending expansion also relied on meme tokens. Some leading memes, such as DogWifHad (WIF)were used as collateral on Kamino to borrow more stablecoins.
A step-by-step system to launch your Web3 career and land high-paying crypto jobs in 90 days.
