Battle Between Solana and Ethereum: Predicting the Primary Altcoin to Dominate Q4
In recent weeks, a significant shift has been observed in the cryptocurrency market, with a notable portion of capital moving from Ethereum (ETH) to Solana (SOL). This capital rotation is contributing to Solana's gains and adoption, setting the tone for flows heading into Q4.
Since the 9th of September, Solana's exchange supply has decreased from 5.29% to 4.72%, indicating off-exchange accumulation. Conversely, Ethereum saw nearly 20,000 tokens moved onto exchanges, weakening its bullish grip.
This trend is not going unnoticed by institutional investors. Since September 9, notable entities such as Galaxy, Jump, and Multicoin have moved significant capital (potentially around $1 billion) into Solana from other assets, likely including Ethereum. This move reflects confidence in Solana's market outlook as institutions seek exposure to high-potential alternatives.
Solana's monthly gain is a robust 17%, while Ethereum's dominance has pulled back 8.3%. Solana's gains are 8 times Ethereum's monthly 7% gains, indicating a strong shift in favour of the up-and-coming cryptocurrency.
On-chain, capital is rotating out of Ethereum into Solana, a trend that is further supported by the SOL/ETH ratio's 8.66% increase, marking its biggest weekly spike since early April.
Meanwhile, Ethereum's Total Value Locked (TVL) has reached an all-time high, but Ether's price has decreased by 13%. In contrast, on-chain divergence indicates that smart money is actively repositioning from Ethereum to Solana.
Solana's daily token volume is up 135% Month-to-Date (MTD), which is nearly 10 times Ethereum's flow. Transactions on Solana are increasing, but specific data regarding the number of transactions or users on Solana or Ethereum was not available at the time of writing.
Solana's fees are relatively low at $0.005, making it an attractive option for users seeking faster transaction speeds and lower costs. This, combined with Solana's growing user base, strong DeFi and NFT ecosystem, and perceived short- and long-term upside potential, is likely driving the capital rotation from Ethereum to Solana.
However, it's important to note that the reasons for this capital rotation and the future performance of both Solana and Ethereum are not definitively known at this time. The potential for bulls to hold their ground or face sell pressure from whale-backed sources remains, making the cryptocurrency market an exciting and dynamic space to watch.
Read also:
- Tesla is reportedly staying away from the solid-state battery trend, as suggested by indications from CATL and Panasonic.
- Lieutenant Governor Kounalakis joins SoCalGas in unveiling the novel H2 Hydrogen Innovation Experience, a one-of-a-kind demonstration.
- Review of the 2025 Lamborghini Revuelto: Blazing Beasts on Wheels
- Tech giant Apple debuts sports app integrating betting odds provided by DraftKings
