Solana Extends Losses as DEX Volume Slumps and Short Bets Rise on Competition Concerns

Solana remained under pressure as network activity slowed and competitive pressures intensified, Cointelegraph reported.

Cointelegraph reported on May 19 that Solana has fallen about 15% since failing to break above $98 on May 11. The token retested the $83 level on May 19, while futures funding rates turned negative.

Solana perpetual futures funding rates are now around minus 3%, down sharply from plus 8% last weekend. In a neutral market, the metric typically stands near plus 9%, indicating stronger demand for short positions in recent trading.

On-chain data also showed weaker activity across the Solana ecosystem. Weekly trading volume on Solana-based decentralized exchanges, or DEXs, stands at about $11 billion, down about 56% from January's average of $25 billion.

Weekly revenue from decentralized applications, or DApps, has also fallen to about $20 million from an average of roughly $35 million in January. The main revenue-generating projects in the Solana ecosystem were identified as Pump, Axiom Pro, Phantom and Jupiter.

Cointelegraph also cited the rise of rival chains such as Hyperliquid and Base as a headwind for Solana. Hyperliquid has been rapidly expanding its market share with its native perpetual futures trading feature, while Base has highlighted its links to the Coinbase ecosystem.

Still, Solana remains the second-largest blockchain by total value locked, or TVL, at about $5.9 billion, trailing only Ethereum. Major TVL projects include Jupiter, Kamino, Sanctum and Raydium.

Solana was trading at $84.19 on Binance's USDT market, down 1.62% from a day earlier.