Solana Q4 2025 Update: Weathering the Downturn

Introduction 

Last quarter capped off a record year for Solana across nearly every meaningful onchain metric. But unlike the explosive activity that defined the first half of 2025, the fourth quarter offered a clearer view of how Solana performs during a more subdued, transitional phase of the crypto cycle.  

As asset prices trended lower and speculative intensity cooled across the industry, onchain activity declined broadly. In this environment, Solana continued to lead areas that matter for sustained network relevance, including decentralized exchange (DEX) volumes, application revenue, and network fees.  

Beneath the surface, the composition of activity on Solana continued to evolve. Memecoins remained an important driver of usage and fee generation, but Q4 marked growing evidence that Solana’s onchain economy is no longer singularly dependent on meme-driven churn. Proprietary automated market makers (Prop AMMs) further entrenched themselves as dominant trading venues for pairs like SOL-USD, increasingly competing with centralized exchanges on execution quality. At the same time, improvements in ownership-driven asset issuance, most notably through the efforts of MetaDAO, began to demonstrate how Solana-native tokens can transition from purely memetic instruments toward vehicles with explicit underlying value. However, Solana lagged in capturing two of crypto’s fastest-growing verticals, perpetuals and prediction markets, despite their outsized impact on network activity elsewhere.  

This shift coincided with continued progress at the protocol layer. The release of validator client Agave 3.0, the long-awaited mainnet launch of the Firedancer validator, and accelerating work on market microstructure improvements reinforced Solana’s focus on reliability, performance, and execution. In parallel, Solana’s emerging privacy stack began to take shape as the broader “privacy meta” gained momentum across crypto, laying the groundwork for more sophisticated onchain financial activity. 

In an overview of Solana’s 2025 progress, Wall Street asset manager Wisdom Tree argued that the key takeaway from 2025 was not simply that Solana “had a good year,” but that the blockchain has entered a new phase as core digital market infrastructure. Progress in the fourth quarter supports that framing. Solana has now demonstrated an ability to sustain leading onchain activity through both expansionary and contracting market conditions, while simultaneously broadening the types of economic behavior the network can support. The question is no longer whether Solana can scale activity, but whether it can convert that activity into durable, diversified onchain markets as the ecosystem matures. 

Key Takeaways 

• Solana completed its first full year without downtime, maintaining stable ~400 millisecond (ms) slot times through the rollout of Agave 3.0 despite periods of elevated network stress. 

• Firedancer reached ~22% of total stake by year-end, reducing single-client risk without compromising network performance. 

• As onchain activity slowed, staking annual percentage yields (APYs) declined to ~6%, increasing competition among validators and increasing focus on maximal extractable value (MEV) capture and block-building efficiency. 

• Solana processed $364b in DEX volume in Q4 (-1% QoQ) and finished 2025 as the leading chain for onchain trading, with prop AMMs nearing 50% of total volume at times. 

• Network fees fell ~60% QoQ, driven by reduced memecoin activity, while Solana retained ~20% share of L1 network fees. 

• Despite a 34% QoQ decline, Solana generated nearly $6b in application fees in 2025, representing 47% of all crypto application revenue, largely concentrated in meme-driven apps. 

• Solana accounted for ~5% of perpetual futures open interest at year-end, trailing app-specific competitors despite execution improvements at perp exchanges Jupiter and Drift. 

• Total value locked (TVL) remained stable at ~7% market share, while stablecoin balances grew 1% QoQ to $14.5b. 

• Progress across spot trading, tokenized assets, prediction markets, and ownership-driven capital formation reinforced Solana’s positioning as emerging infrastructure for Internet Capital Markets, even as these verticals remain early in adoption. 

• U.S. spot Solana exchange-traded funds (ETFs) finally launched in Q4, reaching nearly $1B in assets under management (AUM), with early asset growth resembling BTC’s post-ETF launch trajectory. 

Quarterly Metrics 

Network Performance and Health 

Solana’s long-term success first and foremost depends on the network’s ability to maintain consistent uptime. Solana has suffered no downtime since March 2024. Last year was its first full year without downtime and the fourth quarter was the seventh consecutive outage-free quarter. Major tests of the network, including the launch of the TRUMP token in January 2025 and the Oct. 10 crypto market crash, reinforced Solana’s growing resilience. While previously a major reason for criticism of the network, downtime is now rarely mentioned, and Solana has shed the stigma.  

Uptime alone, however, is not enough. The network also delivers outstanding performance.  

Solana slot times (roughly the equivalent of block times on Ethereum) stabilized around the target of 400 milliseconds after the release of Agave 2.0 in 2024 and remained there following the release of Agave 3.0 in early October. The upgrade introduced execution-layer improvements, including more efficient transaction processing and better compute utilization, while preserving network stability. While Anza has not given a firm timeline, it’s possible that in 2026 we see a formal proposal to reduce slot times from their 400-millisecond standard.  

Average daily compute unit (CU) consumption declined over the course of the quarter as did non-vote transactions per second (TPS). The decline in TPS reflects a broader downturn in onchain activity (covered in the Network Activity section below). The decline in CU consumption, however, reflects both a downturn in activity and ongoing optimizations to transactions that reduce CU requirements. Continuing to optimize transaction CU usage while increasing CU block limits are priorities for 2026 that will allow the network to increase TPS during high-load periods. 

(State of the Network Breakpoint Presentation) 

As Brendan Watt, CEO of Agave developer Anza, outlined in a  presentation during Solana’s annual Breakpoint conference, the community continues to focus on resiliency and performance while enhancing market microstructure to realize its Internet Capital Markets vision. Looking to the year ahead, there are several important protocol updates on the Anza roadmap, most notably the release of the Alpenglow upgrade (covered in depth below) slated for Q3 or Q4 of 2026.  

Validation and Staking 

Validator Client and Version Adoption 

During the fourth quarter, Solana made meaningful progress toward reducing validator client concentration, with Firedancer reaching approximately 22% of total stake by year-end. Firedancer had already been deployed on mainnet for roughly 100 days prior to its announcement at Breakpoint in December, demonstrating the network was already benefiting from increased client diversity throughout Q4.

Firedancer’s growing share of Solana stake represents a structural improvement in network resiliency. Moving away from a single-client network reduces the risk of correlated failures, where a client-specific bug or exploit could impair a supermajority of stake. Importantly, this diversification occurred without observable degradation to network performance.  

Version-level diversification also increased during the quarter. The introduction of Harmonic, new a block-builder, alongside the shutdown of another block-builder, Paladin, reflects an ongoing reshaping of the validator landscape (see more on this in the Block Wars section below). Additionally, the October launch of DoubleZero, a decentralized physical infrastructure network (DePIN), has shifted a growing portion of Solana network activity (40% of stake by the end of 2025) onto dedicated infrastructure pipes. While a broader set of versions and implementations further reduces single points of failure, excessive fragmentation could raise the risk of delayed upgrades or version skew (software mismatches) across validators. 

As onchain activity cooled during the quarter, particularly following a slowdown in memecoin-related usage (see section on Application Activity, below), SOL’s staking APY declined, hovering around ~6% through much of Q4. This reflected both a decline in fee-derived rewards and a relative increase in the share of staking yield attributable to inflation as network activity moderated.  

Lower absolute APYs have intensified competition among validator implementations and operators. Teams such as Harmonic and Jito increasingly try to differentiate their products  by optimizing validator economics, notably MEV capture and block-building efficiency, to retain and attract stake.  

While inflation’s percentage contribution to SOL staking APY has generally waned for the last two years, the decline in network activity during Q4 caused its relative contribution to rise again. Absent a sustained increase in fee-generating activity, total staking APY will continue to face structural pressure over time as Solana’s inflation rate declines according to schedule. 

Against this backdrop, governance discussions around inflation are becoming increasingly consequential. As previously covered by Galaxy Research, a proposal introduced in Q4 recommends an accelerated inflation reduction timeline, underscoring persistent disagreement within the ecosystem regarding the appropriate balance between security incentives and token dilution. This proposal is likely to remain a flashpoint in 2026. 

Network Activity 

DEX Volumes 

Solana DEX volumes proved resilient in Q4, declining just 1% quarter-over-quarter from $368 billion to $364 billion. While volumes did not revisit the highs seen in Q1, Solana recorded its highest full-year DEX volumes in 2025 and maintained its position as the leading blockchain for onchain trading activity throughout the year. 

Solana’s share of total onchain DEX volumes increased modestly in Q4, rising three percentage points to 29%. Solana was the leading chain for DEX volumes every quarter in 2025, approximating 33% of total DEX trading volume across 2025. 

Q4 also marked a continuation of two structural trends within Solana’s DEX ecosystem. Prop AMMs increased their dominance of trading activity on the network (for a deeper discussion of these liquidity pools and their mechanics, see the DEX Volumes section from our prior Solana update). Meanwhile, the percentage of DEX volume driven by meme activity continued to decrease. 

By the end of Q4, Prop AMMs accounted for nearly half of total Solana DEX volume, reaching a new all-time high. This increase occurred while aggregate DEX volumes remained relatively range-bound quarter-over-quarter, indicating a meaningful shift in the composition of trading activity rather than a simple expansion in overall volume. 

Prop AMMs are optimized for high-liquidity markets, such as SOL-USD, and are generally ill-suited for long-tail, low-cap memecoin trading. As a result, their growing share of DEX volume reinforces the view that incremental activity on Solana is increasingly driven by trading flows outside of highly cyclical memes. 

Impressively, onchain spot volume for SOL outpaced Binance and Bybit (the two largest centralized exchanges, or CEXs, by volume) every month in Q4. Memecoins still account for a meaningful portion of overall trading volumes and are an important driver of activity. But there are also growing signs of a rotation away from memecoin-driven churn thanks to the continued maturation of Solana’s onchain market structure. 

Network Fees 

Solana network fees declined by ~60% in Q4 as onchain speculative activity cooled amid a broader risk-off market environment. This drop largely reflects a continued decline in memecoin trading volumes as a share of total Solana activity.   

Network fees on Solana are particularly sensitive to memecoin trading, because memecoin participants tend to be relatively price-insensitive and willing to pay elevated fees to secure early entry into highly reflexive tokens. In other words, the urgency that drives priority fees and MEV tips faded at a faster rate than the actual amount of onchain activity. Memecoins also predominantly trade on traditional AMMs with shallow liquidity, which increases slippage and creates stronger incentives for validators to reorder transactions for the benefit of certain participants. As a result, searchers are often willing to pay higher fees to capture arbitrage and ordering opportunities. As memecoin activity has cooled, these dynamics have reversed, contributing to a meaningful reduction in priority fees and MEV-related payments, most visibly reflected in the sustained decline in Jito tips since Q2 2025. 

The decline in network fees was not unique to Solana, which failed to reach new highs relative to its 2025 levels. This was the case across most chains as onchain activity industrywide cooled in Q4. Notably, however, Solana’s network fee market share, relative to other L1s, declined over the course of 2025, from a peak of 58% in Q1 to 19% at the end of the year.  In the near term, we expect Solana to retain at least ~20% or greater market share in network fees, with fluctuations largely driven by shifts in onchain meme activity. 

Application Revenue 

Application fees dropped 34% in Q4, again in line with a broader decrease in speculative activity as crypto markets entered a risk-off environment. As highlighted in our Q3 update, this activity continues to be dominated by meme applications. Despite the drop, Solana finished 2025 with record annual application fees, nearly $6 billion, more than double 2024’s figure and top among all general-purpose layer-one blockchains. 

Solana has now led in application fee generation for five consecutive quarters. In 2025 alone, Solana generated 47% of all application fees in crypto. Again, an important caveat here is that Solana’s outsized application fees are skewed by speculative memecoin trading activity that may not be sustainable over longer time horizons. Leading applications are dominated by memecoin launchpads (most famously Pump.Fun), decentralized exchanges that facilitate memecoin swaps, and Telegram trading bots and trading terminals that let users trade more easily. The only applications that consistently rank in the top 10 for application fees on a 30-day trailing basis on Solana are its perpetuals protocols, notably Jupiter.  

Diversifying Solana’s leading fee-generating applications is a continued focus and challenge for the ecosystem. While there are businesses beginning to generate fees, such as projects in Solana’s DePIN sector or the recently launched Collector Crypto project that tokenizes trading cards, their revenues continue to pale in comparison to Solana’s dominant meme sector. 

Perpetual Futures 

Perpetuals are one of the most successful products in crypto. Historically, open interest and trading volumes have been dominated by centralized exchanges, with only limited early success from onchain venues. Hyperliquid, a perps exchange with its own blockchain, has meaningfully shifted this narrative. 

Solana, which aspire to become the home of Internet Capital Markets (ICM), capable of hosting any financial market, has struggled to compete in perpetuals since the rise of Hyperliquid. A snapshot of OI across platforms on Dec. 30 showed Solana accounted for just 5% of perpetual futures open interest, while Hyperliquid, Aster, and Lighter maintained their dominance. 

Gaining market share in perpetuals is a clear priority for the Solana ecosystem. Much of the focus on improving Solana’s market microstructure (the mechanics of onchain trade execution), such as Jito’s Block Assembly Market (previously covered here), is driven by the need to achieve feature parity with competitors like Hyperliquid. Specifically, app-specific chains designed for perpetual markets enable critical functionalities, such as allowing makers to cancel orders prior to execution, which is a prerequisite for providing tight spreads without being picked off by takers. 

On Solana, Jupiter and Drift remain the two leading perpetual exchanges, each serving a distinct user segment. Drift targets professional traders with an advanced trading terminal, while the Jupiter Liquidity Pool (JLP) model is better suited for retail users. Both platforms rolled out significant upgrades in Q4 aimed at improving performance and better replicating the CEX and Hyperliquid trading experience. Drift introduced Drift v3, improving execution quality and reducing slippage, while Jupiter announced Ultra V3, an  end-to-end trading engine. 

Looking ahead to 2026, attention is shifting to several upcoming perpetual exchange launches on Solana with differentiated architectures. Two of the most notable ones are BULK (previously covered here) and Phoenix Perpetuals. Phoenix is particularly notable for leveraging innovations from prop AMMs, enabling spot liquidity in major pairs to support perpetual trading. Full details have not yet been released, but for a deeper dive into Pheonix’s design, see Ellipsis Labs founder Jarry Xiao’s presentation at the Solana Money Summit. 

Total Value Locked and Stablecoins 

Solana’s strong performance across trading and activity-driven metrics has not translated into outsized growth in total value locked (TVL) or stablecoin balances. While TVL is an imperfect measure, given its sensitivity to asset prices, it nonetheless provides insight into how capital is positioned on the network.  

In Q4, Solana maintained approximately 7% of total TVL, a level that remained largely stable throughout 2025. This stability reflects the way capital is used on Solana rather than a lack of demand. Much of Solana’s economic activity is centered around trading, settlement, and execution, which do not require capital to remain parked onchain for extended periods. Relatively high staking yields also increase the opportunity cost of deploying SOL into lending markets, naturally limiting leverage-driven TVL expansion and reducing incentives for recursive borrowing. 

Stablecoin balances exhibited a similar pattern. Quarter-over-quarter growth remained modest, increasing 1% to $14.5 billion, while market share edged higher. As highlighted in our previous research, Solana’s ecosystem is less about idle pools of capital than about capital velocity. High throughput and low fees create conditions where assets can move continuously between onchain protocols, generating sustained fee flows and supporting new applications, as the metrics discussed earlier demonstrate. 

Ultimately, stablecoins and perpetuals represent two of the most important growth vectors in crypto today. While Solana’s metrics reflect a network optimized for trading and settlement rather than idle capital accumulation, maintaining competitiveness in these markets will be essential. The ability to capture stablecoin flows and support large-scale perpetual trading will be a key determinant of Solana’s role in the next phase of onchain capital markets.

Notable Q4 Developments 

Breakpoint 

Solana’s flagship conference, Breakpoint, was held in Abu Dhabi in December. The event is an annual checkpoint for the Solana ecosystem, a barometer for activity and ecosystem priorities. Galaxy Research covered the event in real time (see our coverage here), and developments since have only reinforced our views of the main takeaways. 

• Market Microstructure: Addressing issues that constrain application development. The priority here is enabling Solana teams to build perpetuals exchanges that can compete effectively with Hyperliquid and regain market share under the concept of Application Controlled Execution (ACE). 

• Transitioning from Memes to ICM: Maintaining Solana’s dominance across key blockchain activity metrics (such as DEX volumes and application revenues) while shifting the drivers of that activity away from memes and toward ICM. The two strongest candidates for this transition today are spot markets that rival or outperform CEX-grade execution, and launchpads for ownership tokens like Meta-DAO, which represent the first wave of less speculative and more fundamental, growth-oriented asset issuance onchain. 

• Institutionalization of onchain capital markets: Breakpoint featured multiple announcements highlighting Solana’s push into institutional-grade financial infrastructure. These included JPMorgan’s arrangement of an onchain commercial paper issuance for Galaxy on Solana; the announcement of the SWEEP tokenized cash management fund by State Street, Galaxy, and Ondo; and Keel’s Tokenization Regatta—an initiative to deploy up to $500m into Solana-native real-world asset (RWA)  tokenization efforts. 

• Protocol and client upgrades to support scale, latency, and resilience: Core infrastructure development was emphasized as a prerequisite for supporting more demanding financial workloads. Key updates included confirmation that Firedancer is live on mainnet; advancing multi-client resilience; and continued work on Multiple Concurrent Proposers (MCP) and Alpenglow, a proposed next-generation consensus design targeting materially lower finality latency. 

• Distribution and UX as first-class constraints: Breakpoint highlighted increased emphasis on distribution. Examples included the Phantom wallet’s in-app prediction markets; Coinbase’s in-app onchain Solana token trading; and Solana Mobile’s strategy to expand reach via chipset-level Android integrations—underscoring that adoption depends as much on access and UX as on raw throughput. 

• Developer Activity: Colosseum, a Solana-focused venture fund that also runs hackathons and accelerators, hosted its largest hackathon to date in Q4, attracting more than 9,000 participants. The scale of participation underscores the depth of Solana’s developer ecosystem, which continues to benefit from a reinforcing flywheel: a large and active user base attracts developers; developers build applications that generate real usage; and that usage, in turn, draws additional developers into the ecosystem. This dynamic remains one of Solana’s most durable competitive advantages. 

The Block Building Wars 

The Solana block building wars are in full swing and intensified in Q4, primarily driven by competition between Jito and Harmonic.  

Jito is the dominant liquid staking provider and validator client on Solana, with over 93% of staked SOL delegated to Jito-enabled validators as of Dec. 31. In addition to its validator footprint, Jito has historically served as Solana’s primary block builder and last year introduced the Block Assembly Marketplace (BAM). In November, Temporal introduced Harmonic as an alternative block-building client.  

Solana targets ~400 millisecond slots, during which a single validator (the leader) controls transaction inclusion and ordering. While Solana’s original design envisioned continuous transaction intake and real-time shred (block fragment) propagation, block building in practice has become increasingly intermediated by offchain infrastructure that shapes transaction flow and ordering before execution. Jito historically dominated this role, but Harmonic is emerging as a competing architecture. 

Both Jito and Harmonic delay shred propagation during block construction, creating an out-of-protocol transaction aggregation layer that lets builders reorder transactions and extract additional value. However, they differ materially in execution. Jito runs discrete ~50 ms auctions to select transaction bundles and incrementally assemble blocks, enabling earlier shred emission and balancing latency with reward maximization. Harmonic instead runs a single slot-level auction near the end of the slot (~380 ms), where competing builders submit full block proposals before shreds are propagated, prioritizing open builder competition over low-latency finalization.  

There is no objective definition of the “best” block, only what the protocol permits and what individual validators choose to optimize for. Some validators prioritize yield maximization, while others may accept lower returns in favor of reduced extraction and long-term network health. These subjective trade-offs explain why both architectures can plausibly claim to produce superior outcomes. 

Transaction reordering is not inherently harmful, but risks emerge when ordering moves out-of-protocol. Intermediaries that control transaction flow and block construction can accumulate disproportionate economic influence, creating incentive-driven feedback loops that centralize stake. Ethereum’s experience with MEV-Boost illustrates how quickly block building can consolidate around a small number of dominant relays and builders. As a result, block building has become a critical architectural issue for Solana, not because optimization is undesirable, but because unchecked offchain control over ordering can threaten protocol neutrality and long-term decentralization.  

One thing is clear: the block building battles on Solana are just beginning and will continue to accelerate over the coming year. Whether this will be a transitional phase or a long-running struggle remains an open question. From the perspective of core teams such as Anza, the long-term objective is clear: control over ordering and inclusion should move in-protocol, and forthcoming upgrades, most notably Alpenglow and MCP, are intended to reduce reliance on off-protocol solutions by standardizing these mechanisms. 

Exchange-Traded Funds (ETFs) 

Q4 marked a major milestone in Solana’s institutional adoption with the approval and launch of multiple spot Solana ETFs in the U.S., a significant step in bringing regulated investment products tied to SOL into mainstream capital markets. Bitwise was the first issuer to bring a spot Solana ETF to market, marking a key milestone in Q4 2025 for regulated SOL exposure. Since that launch, seven additional Solana-linked ETFs have followed, including products from 21Shares, Grayscale (via conversion of its trust ), VanEck, Fidelity, Franklin Templeton, REX-Osprey, and Canary Capital 

Solana ETFs benefited from new regulatory pathways that streamlined approvals following the Securities and Exchange Commission’s adoption of generic listing standards for spot crypto ETFs in September (see prior coverage here). More distinctively, several Solana ETFs were able to launch with staking exposure as part of their structure, a feature that was not permitted when ETH ETFs launched, following clearer SEC guidance around staking activities. This structural difference likely contributed to stronger early demand by offering exposure to both price performance and native staking yield. 

Even during a broader market risk-off environment, Solana ETFs recorded relatively consistent inflows following launch, with only three net outflow days in Q4 and assets under management approaching $1 billion by quarter-end. 

While absolute AUM remains well below BTC and ETH ETFs, the pace of asset accumulation from launch more closely resembles the early BTC ETF rollout than the ETH ETF experience. As illustrated above, Solana ETFs have grown more quickly relative to SOL’s market capitalization than ETH ETFs did at a comparable stage, suggesting that early adoption has been stronger than AUM alone would imply.  

While ETF flows do not directly translate into onchain activity, their significance lies in broadening the investor base exposed to SOL. Over time, sustained ETF adoption could indirectly support onchain liquidity by increasing the pool of long-term holders and improving the asset’s institutional credibility. 

Internet Capital Markets March Forward 

As we wrote in our prior update, “Solana becoming the home for Internet Capital Markets will not be driven by a single product class or vertical. It’s dependent on the ecosystem’s ability to rapidly test, iterate, and scale across multiple domains—from cultural assets to infrastructure networks to regulated finance—while competing in an increasingly sophisticated multi-chain landscape.” 

That momentum continued to build in Q4. As discussed above, Solana made meaningful progress toward becoming a competitive spot trading venue, driven by the rise of prop AMMs that now rival leading centralized exchanges in SOL-USD volume. While perpetuals remain an area of relative weakness, particularly compared to app-specific chains like Hyperliquid, significant resources are being deployed to close this gap. These efforts include major infrastructure upgrades (ACE and MCP) alongside the launch of new protocols such as Bulk and Phoenix Perpetuals, signaling a renewed push to regain market share.

MetaDAO and Ownership Coins 

Ownership coins (see our previous coverage here) represent one vertical where Solana has clearly differentiated itself. In Q4, capital raised via MetaDAO, the decentralized autonomous organization that pioneered these assets, nearly tripled relative to the combined totals of Q2 and Q3. This growth reflects product-level improvements, rising demand from teams seeking onchain capital formation, and investors looking for tokens with stronger guarantees and protections than the usual DAO fare. 

In December, Colosseum introduced the Simple Token Agreement Market Protected (STAMP), a fundraising framework that allows startups to raise capital using SAFE- or SAFT-like instruments while ensuring the token remains the sole economic asset. As MetaDAO continues to expand its offerings, including the rollout of permissionless token launches in 2026, and as projects funded over the past year begin to ship products, we expect MetaDAO to become a cornerstone of Solana’s capital formation stack, potentially as consequential to Solana’s long-term success as Pump.fun has been.  

Stepping back, platforms like MetaDAO matter for two reasons: 

• First, they transform tokens into genuinely investable assets, catalyzing a broader shift in how crypto projects are launched and capitalized. The proliferation of similar models, both on Solana and across other smart contract platforms, underscores the influence of this approach. These are not memecoins. They are teams attempting to build real companies that level the playing field between founders and investors, and in doing so, raising the bar for what onchain capital formation can look like. This evolution is foundational to making Internet Capital Markets viable at scale  

• Second, MetaDAO serves as a flag bearer for the Solana ecosystem more broadly. It reinforces Solana’s position as a hub for experimentation and innovation and highlights the depth and quality of its developer base, an increasingly important advantage as competition intensifies across chains. 

Tokenized Equities 

Solana saw measurable progress in becoming a hub for trading tokenized equities in Q4, extending its spot trading infrastructure beyond crypto-native assets and into traditional capital markets. Unlike tokenized Treasuries and cash management products, which have seen faster adoption due to clearer regulatory pathways and simpler asset structures, tokenized equities face higher legal, compliance, and distribution hurdles. While there is still no definitive regulatory clarity, Q4 saw a notable increase in issuance and early trading activity for tokenized equities. 

While Ethereum retains the majority of tokenized equity market capitalization, reflecting its role as the primary platform for issuance and long-term custody, Solana’s share of onchain value grew meaningfully during Q4. The divergence between onchain value and transfer volume is where Solana’s role becomes more pronounced. Solana captured a disproportionately large share of tokenized equity transaction volume relative to its market capitalization. This pattern mirrors Solana’s broader strengths across onchain spot markets: low fees, fast finality, and a trading environment optimized for frequent transfers rather than static buy-and-hold positioning. 

Taken together, the data reinforces a familiar dynamic seen elsewhere in Solana’s ecosystem. Ethereum continues to function as the dominant platform for asset origination and stored value, while Solana is carving out a role as a high-velocity execution and settlement layer. In tokenized equities, as in crypto-native assets, Solana’s comparative advantage lies less in passive capital aggregation and more in enabling frequent transfers, composable integrations, and real-time trading workflows.  

At the same time, tokenized equities remain small relative to the scale of equity-linked perpetual derivatives, where adoption has been far stronger. Hyperliquid’s HIP-3 markets illustrate that demand for equity exposure in crypto is currently concentrated in leveraged, perpetual markets that offer continuous liquidity and capital efficiency. 

Privacy 

One infrastructure development that will be required for Solana’s ICM initiative to expand into more institutional and regulated markets will be a strong privacy layer. Beyond ideological reasons, enabling a comprehensive privacy ecosystem on Solana is critical for enabling large institutions and businesses to feel comfortable operating onchain. These companies require confidentiality, not anonymity, and audited, battle-tested solutions that protect their onchain activity while complying with regulatory requirements. 

Both the Solana Foundation, the nonprofit that stewards the ecosystem, and independent application teams have been working for years to make privacy a reality on Solana (see here for a solid overview of previous attempts). Q4 saw continued momentum toward achieving that goal. Key developments included:  

• Arcium (previously Elusiv) is at the forefront of Solana’s privacy integration strategy and announced the upcoming release of its “mainnet alpha” and Confidential SPL-Token (C-SPL). While these were originally scheduled for Q4, ther were released in Q1 2026. 

• Umbra, a privacy solution built using Arcium, raised a MetaDAO ICO in October which attracted over $150m in commitments, demonstrating growing interest in privacy solutions. Umbra’s product is also expected to launch in Q1 2026. 

• Privacy Cash, a new privacy protocol on Solana, surpassed $120m in private transfer volume. 

• A third-party security audit of the Token-2022 Confidential Transfer extension was published, strengthening confidence in Solana’s native ability to support encrypted balances and amount-hiding transfers.  

These developments positioned privacy as one of Solana’s most important infrastructure narratives heading into 2026. Rather than incremental experimentation, the ecosystem is entering a phase where programmable privacy at an institutional grade is beginning to move into production, directly supporting Solana’s broader ICM ambitions. 

Prediction Markets  

Prediction markets emerged as a significant vertical for Solana in Q4, marking another step in the network’s broader push toward Internet Capital Markets. The most notable development came in December, when Kalshi, the largest U.S.-regulated prediction market platform, announced integrations with Jupiter and DFlow, enabling onchain routing and liquidity access through Solana’s trading infrastructure.  

While Kalshi’s core markets remain offchain and regulated, the integration represents an important bridge between compliant prediction markets and onchain execution, settlement, and distribution. Kalshi is leveraging Solana’s mature trading stack to expand access and improve execution. 

Given the recency of the integration, usage and volume metrics are not yet meaningful and represent a small fraction of Kalshi’s overall activity. However, the significance of the launch lies less in near-term volumes and more in distribution and composability. By embedding prediction markets into widely used Solana venues such as Jupiter and surfacing them through familiar wallets and interfaces like Phantom, the integration lowers friction for users and introduces prediction markets as a native extension of onchain trading rather than a standalone product. 

While it remains early, Q4 established prediction markets as a credible vertical within Solana’s ecosystem. If adoption accelerates, success will depend less on the novelty of the product and more on Solana’s ability to provide deep liquidity, seamless integration, and regulatory-aware infrastructure. In that sense, prediction markets serve as a useful case study for Solana’s broader ICM thesis: differentiated applications scaling not in isolation, but by plugging directly into the network’s trading, routing, and user-access layers. 

Conclusion 

Q4 2025 marked a transitional quarter for Solana. The network sustained leading activity levels through a risk-off environment, maintained uninterrupted uptime, and continued to expand the range of financial behavior it can support onchain. 

At the protocol layer, progress on client diversity, execution efficiency, and forthcoming upgrades such as Alpenglow signal a network increasingly optimized for reliability and institutional-grade workloads. At the application layer, Solana’s dominance in spot trading, advances in capital formation, and early traction across ETFs, prediction markets, and tokenized assets point to a broadening economic base beyond memecoin-driven churn. 

At the same time, Q4 made clear that not all markets are developing at the same pace. Most notably, perpetual futures remain fiercely competitive and fragmented. Closing these gaps will depend on whether ongoing efforts to improve market structure, block building, and application-level execution translate into deeper liquidity and more persistent activity onchain. 

Taken together, Solana’s Q4 performance supports Solana’s continued reframing from a chain primarily dominated by speculative use cases to an emerging piece of core financial infrastructure. If 2025 was about establishing reliability and scale, 2026 will be about turning that foundation into deeper liquidity, stronger market structure, and sustained onchain markets.