The Solana network hit an all-time high (ATH) in Non-fungible token (NFT) transactions, surpassing 1 million for the first time in September. According to a report by Defiant, NFT transactions have boomed on Solana, the famous Ethereum killer. Solana network’s popularity grew after the blockchain offered low fees and record-high transaction speeds.
The most popular NFT marketplace on the Solana blockchain Magic Eden recorded over a 36% spike in its NFT market share during the second week of September. This was a 12% increase from the previous week. Another NFT marketplace on the Solana network is Metaplex, which also recorded a significant rise in NFT market share during the same duration.
The success of Solana comes as the Ethereum killer continues to provide a hub for many crypto apps, solving problems that Ethereum users continue to face. NFT activities on the Solana network have consequently been rising according to the recent record volumes.
Solana blockchain’s native token, SOL, has been performing dismally for the past two weeks after plunges witnessed across the crypto market over the same time. According to data from CoinGecko, SOL is down by almost 2% in the past 24 hours, although the Ethereum killer continues to do better than BTC and ETH.
In the week ending September 12, NFT sale volumes on Solana approached 1.5 million SOL tokens, which according to data by Nansen, is worth around $50 million. Additionally, the number of Solana users that traded NFTs that week recorded the highest count since June 2022.
While high transaction fees on the Ethereum network discourage users from entering the web, these high fees come with certain advantages, including limiting wash trading. Wash trading is when users transfer assets between their wallets to create fake demand. Social media reports suggest that the recent increase in NFT volumes on the Solana network is attributed to washing trading activities.
Solana NFT Volumes Are Organic
According to a software engineer serving with the Nansen NFT team, the Solana trading volumes are indeed organic. The engineer, Javier Gonzalez, argues that the influx in trading volumes is not a result of wash trading activities.
Gonzalez’s argument is underscored by the fact that the trading actions involved large and small NFT collections. The engineer also noted that the old projects also recorded growing interest. Gonzalez adds that the influx in trading volumes was mainly because of returning buyers, not newcomers.
Data from The Block reveals that the number of new NFT tokens minted on Solana leaped from a mere 39,000 on September 4 to over 300,000 NFTs on September 7. This represents over 700% within three days and marks the highest surge since its May ATH.
Further supporting his argument that Solana NFT volumes are organic, Gonzalez notes that the spike may have resulted from ABC and y00ts NFT collections going live after being released on August 22 and September 6, respectively.
In September, Solana’s y00ts NFT collections and Abracadabra NFTs have become among the most popular collections. DappRadar shows that y00ts NFTs and ABC collections generated a trading volume of over $10 million and $2.1 million during early September. Many experts continue to attribute Solana’s success to the performance of ABC and y00ts collections.
Ethereum remains relentless
Before Ethereum’s Merge event, industry experts foresaw tight competition between Ethereum and Solana because the latter also used the exact PoS consensus mechanism that Ethereum was transitioning to. Post-Merge, Ethereum expects to attract many new NFT investors that previously shunned away from its high transaction fees and related network factors.
While Solana continues to record sporadic growth, Ethereum is maintaining its mantle as the number one blockchain for NFTs. Despite plunging from their ATH, the Nansen report shows that NFT trading volumes on Ethereum have hit 330,000 ETH over the past 30 days. Ethereum is the most famous NFT blockchain, providing a hub for renowned blue-chip collections such as BAYC and CryptoPunks.
What next for Solana?
While September has been a gushing month in NFT trading on Solana, the network recorded NFT trading volumes worth $126 million over the past 30 days. This is evidence that NFT artists prefer the Ethereum blockchain to the Solana network.
Even so, the Solana network is progressively making a name for itself as one of the best blockchain networks for NFT artists and traders. Gonzalez also noted that Solana blockchain features iconic collections and could quickly secure a position as the second-largest network for NFT assets.
“It seems like Solana has some iconic collections,” Gonzalez said. “Solana should be able to claim, ‘We are the second chain for NFTs.’”