Solana (SOL) Rallies to $229 on Rate Cut Hopes and Surging Network Activity

Solana's native token, SOL, rebounded to $229 following a brief dip, buoyed by positive investor reaction to the US Federal Reserve's minutes, which reinforced expectations for 2025 interest rate cuts. This macroeconomic optimism has traders setting their sights on $300 for SOL.

The bullish sentiment is supported by strong on-chain and derivatives data, highlighting Solana's dominance in key metrics:

• Network Fees and Activity: Solana's 7-day network fees increased by 22%, driven by rising activity on decentralized exchanges (DEXs). In contrast, Ethereum's network revenue fell by 21%. Crucially, Solana's transaction count continues to exceed the combined total of Ethereum and its Layer-2 ecosystem.
• DEX Volume Dominance: Solana has reclaimed its leadership in decentralized exchange activity, logging $129 billion in 30-day volume, surpassing Ethereum's $114 billion. Major Solana DEXs like Pump (+78%), Meteora (+73%), and Raydium (+46%) all saw significant volume increases.
• Total Value Locked (TVL): Solana's TVL grew by 8% in 30 days to reach $14.2 billion, solidifying its position as the second-largest network by market share (8%). This contrasts with Ethereum's more modest 3% TVL increase over the same period.

Cautious Derivatives and Institutional Inflows

Despite the strong fundamentals, the SOL perpetual futures funding rate remains subdued, falling below the 6% neutral level. This signals a cautious approach from leveraged traders, potentially due to attention being diverted by competitors like BNB Chain, which saw a remarkable 28% rally driven by memecoins.

Nevertheless, institutional interest remains high. Solana ETPs/ETFs recorded $706 million in inflows for the week ending September 5, far outpacing other assets. Investors are now anticipating the US SEC's potential approval of multiple spot Solana ETFs on Friday, an event that could trigger further institutional investment and help push SOL past the $300 target.

October 2025, Cryptoniteuae