Raydium Dominates Solana DeFi, Gas Fees Drop 80% As Meme Coin Activity Shifts

Decentralized Finance (DeFi) activity might be falling as of early September. According to DeFiLlama, all DeFi protocols spread across major blockchains like Ethereum and Solana manage roughly $77 billion worth of assets. Ethereum dominates in total value locked (TVL).

Raydium Dominates Solana DeFi Scene

While this might be the case, the Solana DeFi scene is booming if recent data is anything to go by. Raydium, a leading decentralized exchange (DEX) on Solana, has solidified its position as a top DeFi protocol on the platform.

According to Artemis data shared by an analyst on X, the DEX commands a 60% market share, attracting over 200,000 active users on average. At this pace, Raydium is the most engaged DeFi protocol ahead of Jupiter.

The surge in user activity has also seen the daily active address base explode. The latest data shows that the modern blockchain posts an average of 5.5 million daily active users, the highest in history. At this rate, despite the booming Ethereum and its layer-2 ecosystem, their protocols are not as active as those deploying on Solana.

Solana is scalable on the base layer, unlike scaling solutions for Ethereum like Base and Arbitrum. The result translates to high throughput and more confidence since no tools like a fault-proof system or a sequencer exist. These off-chain systems tend to introduce weaknesses and lead to centralization.

Gas Fees Rapidly Falling, Meme Coin Activity Shifts To Tron

Interestingly, even as daily active addresses rise, gas fees plunge.  As of September 7, revenue generated from gas fees was at the lowest level in six months, hovering at around $414,000.

Though revenue recovered temporarily, it is nothing compared to the $5 million generated on March 18, looking at TokenTerminal data.

The drop in fees could be linked to the dropping popularity of Pump.fun, a meme coin launchpad on Solana. Over the past few weeks, gas fees from the launchpad have been declining, dumping by over 80% after peaking at over $2.31 million in late July. By September 7, Pump.fun generated around $319,000 in fees, looking at DeFiLlama.

Meme coin activity, looking at solid DeFiLlama data, seems to be shifting to Tron, another scalable blockchain. The launch of a meme coin launchpad, SunPump, in August coincided with the decline of Pump.fun activity, and thus, there are daily fees for Solana.