Sygnum, the Swiss- and Singapore-regulated digital-asset banking group, has ignited contemporary debate over the pecking order of smart-contract platforms with the publication of its 8 Might “Digital Nugget” commentary, pointedly titled Is Solana overtaking Ethereum?
Solana Vs. Ethereum
Within the report, Sygnum’s analysis desk acknowledges that Ethereum retains an “undisputed” lead in revenues and institutional adoption, but concludes that the market narrative has swung decisively in Solana’s favour—a reversal dramatic sufficient for the financial institution to explain Solana because the system presently “overtaking” its older rival in mind-share if not in absolute fundamentals.
“Ethereum’s strategic pivot […] has led to a 5–10 % outperformance of Ether over Solana,” the observe observes, citing the chain’s refocused roadmap on main-net scalability and user-experience. Nonetheless, the authors concede that “sentiment on Ethereum stays poor for now” regardless of its “continued main place and nonetheless superior income era.”
Sygnum’s analysts dissect the often-conflated metrics of charges, revenues and token worth. Whereas Solana has lately “dominated in charge era,” its protocol revenue “continues to considerably lag Ethereum (aside from the temporary interval across the issuance of the Trump household tokens on Solana).” The financial institution quantifies the hole at roughly two- to two-and-a-half-times in favour of ETH—an edge that endures even after Solana’s frenetic surge in retail transaction volumes.
Layer-2 dynamics on Ethereum, lengthy criticised for siphoning exercise away from the principle chain, obtain a balanced remedy. The report reiterates that rollups have “led the market to see Ether as much less helpful,” however provides a little-noticed parallel: “a comparable concern affecting the worth of the Solana tokens is neglected.” As a result of “many of the charges are paid to validators and don’t develop the worth of the Solana token,” Solana’s personal financial premium could also be equally weak.
Token-economic self-help shouldn’t be on the rapid horizon: a group proposal to tweak Solana’s inflation schedule—an initiative Sygnum says “would have had the same impact” to ETH’s fee-burn mechanic—“was conclusively voted down lately.”
Market capitalisation paints a distinct image of runway. With Solana valued at roughly one-third of Ether however already producing half its revenues, Sygnum calculates “extra room for Solana to outperform – particularly with the tailwind of a greater narrative and sentiment.” Even so, the report cautions that Solana’s revenue stream is “extremely concentrated within the memecoin sector” and therefore judged by traders as “much less secure.” The implication: valuation reductions could also be rational moderately than sentimental.
By The Numbers
Ethereum’s entrenchment amongst regulated establishments offers the counter-weight. “Tokenisation, stablecoins, and DeFi” are the use-cases “exhibiting traction and have the assist of governments, regulators, and conventional monetary establishments,” Sygnum writes, noting Ethereum’s 57% share of tokenised belongings—augmented by an additional 20% on its Layer-2 cohort zkSync. BlackRock’s flagship BUIDL fund, for instance, retains “93% of its belongings on Ethereum,” a call the asset supervisor hyperlinks to the community’s “decentralization, credibility and safety.”
In contrast, Solana’s slice of the tokenisation pie “stays under 3%,” and its year-to-date doubling of stablecoin share leaves it “simply above 5%,” nonetheless an order of magnitude behind Ethereum. The world the place Solana has moved the needle most convincingly is DeFi whole worth locked: its share has climbed from 9.5% to 11.5% in opposition to Ethereum’s slide from 63.5% to 55% since January.
“The narratives proceed to strongly favour Solana,” Sygnum concedes, even after Ethereum Basis’s inside reshuffle and public vow to “regulate its go-to-market technique and to make clear and articulate the worth proposition.” But narrative alone is not going to resolve custody mandates or settlement rails for conventional finance.
“We don’t but see convincing indicators that Solana could be the popular selection as Ethereum’s safety, stability and longevity are extremely prized,” the financial institution concludes, reminding readers that community results in crypto “are very exhausting to beat – simply as they’re in different tech fields corresponding to social media.”
Certainly, historical past’s roll-call of “Ethereum killers” is a cautionary story: “most have pale away till now,” regardless of technological ingenuity. Towards that backdrop, the report’s abstract is each sober and placing: “Ethereum’s 2-year lengthy underperformance vs Solana has been briefly arrested because the strategic pivot… [and] the token worth continues to be supported by revenues operating at double the speed of Solana’s revenues.”
Sygnum’s evaluation stops in need of declaring an irreversible energy shift, however its framing is unambiguous: within the present information cycle Solana enjoys the higher hand in notion, whereas ETH retains the higher hand in fundamentals. Whether or not that juxtaposition quantities to Solana “overtaking” Ethereum or merely drafting in its slipstream will rely, the financial institution says, on which chain wins the arrogance of worldwide finance within the “medium-term.”
For now, as Sygnum delicately places it, “the market has targeted on Solana’s larger transaction volumes,” even when “protocol revenues proceed to considerably lag Ethereum.” Within the scorecard of Might 2025, Solana might declare the group, but Ethereum nonetheless holds the belt.
At press time, ETH traded at $2,344.
Featured picture created with DALL.E, chart from TradingView.com
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