According to statistics tracker DeFi Llama, the Solana network was passed for the first time today for a total of $2 billion. Total Locked or TVL refers to how many crypto assets are flowingg in the decentralized financing (DeFi) protocol on the network.
The DeFi protocol allows various financial transactions to be carried out – borrowing, earning interest, exchanging assets – all using automated “smart contracts” instead of human intermediaries. Although DeFi originated on Ethereum, where nearly $110 billion was tied to protocols like Aave, Compound, and Uniswap, it has since spread to other networks, with its biggest competitor being Binance Smart Chain ($17 billion on TVL).
In the same way, Solana is playing to attract DeFi developers and users from Ethereum, which sometimes struggles to handle thriving transactions caused first by the growing demand for DeFi applications and then by the growing interest in blockchain-based NFTs. cheap, trade for digital and/or real collectibles. The team behind the original betting network says Solana is now the go-to for Ethereum with its fast and scalable Eth 2.0 network, which measures transaction fees in cents rather than dollars.
The mission was a bit complicated with the advent of Polygon, the Ethereum-based network that helped relieve some of that pressure. According to DeFi Llama, there are more than $5.4 billion of assets locked in the network; In fact, Polygon alone has more money locked up in Aave’s DeFi credit history than Solana’s entire TVL.
But Solana is accelerating, literally and figuratively, the ape of Ethereum. When Ape Academy’s NFT Degenerate collection sold out this week, bringing in $5.9 million in trading volume, it helped put the SOL coin into the top 10 by market cap. SOL prices are up 70% in the past week, according to CoinGecko, hitting a record high of $74.08 this morning. This has affected TVL DeFi protocols such as Raydium (think of this as Solana’s version of Uniswap) which use SOL instead of USD or ETH as part of their crypto ecosystem.