tl;dr
Renowned asset management firm Franklin Templeton's report highlights the rapid growth and potential of Solana's decentralized finance (DeFi) ecosystem. The report suggests that Solana's valuation could soon rival Ethereum's, as its DeFi protocols are among the most utilized and highest-earning acro...
Renowned asset management firm Franklin Templeton's report highlights the rapid growth and potential of Solana's decentralized finance (DeFi) ecosystem. The report suggests that Solana's valuation could soon rival Ethereum's, as its DeFi protocols are among the most utilized and highest-earning across all blockchain environments.
Notably, six Solana-based protocols have surpassed $1 billion in Total Value Locked (TVL), with Solana outperforming Ethereum in various key metrics. Despite this impressive growth, the report points out that Solana's DeFi protocols remain undervalued compared to their Ethereum counterparts. However, the increased activity has contributed to Solana's rising market capitalization and overall ecosystem growth, prompting Franklin Templeton to file for a spot Solana ETF with the US SEC.
While some investors are optimistic about Solana's potential, industry analysts caution against assuming it will surpass Ethereum imminently, emphasizing Ethereum's established trust and vast developer community as critical factors in maintaining its leading position in the DeFi space.
In recent months, Solana has demonstrated remarkable growth in the decentralized finance (DeFi) sector, prompting discussions about its potential to rival Ethereum's valuation. A new report by Franklin Templeton highlighted that Solana's DeFi protocols are among the most utilized and highest-earning platforms across all blockchain environments.
The surge indicates a significant shift in DeFi activity towards Solana, challenging Ethereum's longstanding dominance in the space. Jito (JTO) leads the charge, a liquid staking protocol that recently reached an all-time high of $3 billion in TVL.
Further emphasizing its growing prominence, Solana's active addresses per hour were reported to be 26 times higher than Ethereum's as of January 2025. This surge in user activity reflects the network's scalability and efficiency, making it an attractive platform for developers and investors seeking faster transactions and lower fees.
Despite the impressive growth, Franklin Templeton's report points out that Solana's DeFi protocols remain undervalued compared to their Ethereum counterparts. The analysis reveals that Solana's DeFi tokens are trading at lower valuation multiples, although they exhibit higher growth profiles and strong fundamentals.
Reflecting this optimism, Franklin Templeton filed for a spot Solana ETF (exchange-traded fund) with the US SEC. Notably, the proposed ETF includes staking capabilities, allowing investors to earn rewards by participating in network validation processes, which is the first for a Solana-based ETF.
While some investors are enthusiastic about Solana's potential, others remain skeptical. An industry analyst noted that while Solana has narrowed the market capitalization gap with Ethereum, it still faces significant hurdles, such as established trust, a vast developer community, and the need to address centralization concerns and achieve parity in developer adoption. As Solana continues to innovate and expand its DeFi ecosystem, its potential to reach valuations comparable to Ethereum becomes more plausible.
BeInCrypto data shows SOL was trading for $149.77 as of this writing, up by over 5% in the past 24 hours.