The Solana community is celebrating record-high revenue, but the milestone is a sign users are paying high transaction fees.
The turf war between Solana and Ethereum supporters continues to heat up, with the Solana community celebrating the network overtaking Ethereum by daily revenue for the first time.
On May 12, Solana’s total economic value — transaction fees combined with Maximal Extractable Value (MEV) — surpassed that of Ethereum for the first time, according to data from Blockworks Research.
The chart, which received widespread circulation on social media, shows Solana hosting nearly $2.25 million in 24-hour revenue — beating out Ethereum’s $1.98 million by nearly 13%.
The milestone was celebrated across the Solana community, with supporters heralding it as signaling Solana will soon enjoy a flippening over Ethereum.
“For the first time ever, Solana has recently eclipsed Ethereum in daily economic value,” said Joe McCann, the founder of Asymmetric, a cryptocurrency investment firm. “Friendly reminder that SOL is currently 1/5th the value of ETH.”
“[Solana] is still 100x cheaper to transact on for users,” tweeted Ansem, a popular trader and influencer. “Explain to me in detail why ETH is still worth 5x more by market cap.”
But not everyone was convinced, with Ethereum’s bustling Layer 2 ecosystem notably absent from Blockworks’ data.
“It’s crucial to remember this comparison only includes the Ethereum mainchain, not accounting for ETH’s value as a payment method and fuel for transactions for various Layer 2 networks,” retorted Leon Waidmann, an analyst at BTC-Echo. “This makes the comparison flawed… people underestimate how positive the adoption of L2s is for the monetary premium of Ethereum.”
Solana fees skyrocket
Solana’s recently rocketing fees were also conveniently ignored among celebrations of the network’s revenue milestone.
One of Solana’s core value propositions is its high throughput, with the network consistently hosting between 2,000 and 3,000 transactions per second (TPS) in recent days.
However, recent network congestion has resulted in a volume of transactions failing to execute, with data from Dune Analytics indicating more than 60% of Solana transactions have failed over the past month. The number of successful Solana transactions also dropped more than 50% since the start of November.
To combat the congestion, Solana users have been forced to pay increasingly high fees to ensure their transactions execute. Average Solana transaction fees broke into new all-time highs above $0.018 in March and posted an all-time high of $0.06 on March 18.
Although Solana fees have since fallen to $0.0136, Solana users are still paying significantly higher sums to transact compared to leading Ethereum Layer 2s following the Dencun upgrade in March.
According to data from GrowThePie, average transaction fees on Arbitrum, Optimism, and Linea currently sit at $0.005, $0.006, and $0.012 respectively.
Data from The Block also shows that more than 75% of Solana’s transaction revenue was attributed to non-vote priority fees from February through May.
Non-vote priority fees are additional fees users pay to prioritize their transactions over others in a congested network, excluding votes for network validators. These fees help ensure that their transactions are processed faster even during heavy network traffic.
Ethereum’s continued dominance
Despite the buzz surrounding Solana’s revenue milestone, Ethereum continues to lead web3 by many key metrics.
Ethereum continues to beat out Solana by decentralized exchange volume, enjoying a daily lead of 33% and weekly primacy of 26%, according to DeFi Llama.
Further, analysis from Messari shows Ethereum boasting a 300% lead according to its “real volume” metric — which seeks to filter out wash-trading when measuring the value of on-chain activity. As of May 13, Solana’s real volume is $6.77 billion, significantly lagging behind Ethereum’s $24.8 billion.
Ethereum’s DeFi total value locked (TVL) is also $53.6 billion, sizably overshadowing Solana’s $4.5 billion. Ether also boasts a market cap of $354.8 billion compared to $111.3 billion for SOL.
