ON–145: Solana

Coverage on Solana and Magic Eden.

Nov 4, 2022

ON–145: Solana

About the editor: Spencer Noon is Co-founder & General Partner at Variant Fund.

Note from the editor:

145(!) editions of OurNetwork have demonstrated the power of using on-chain analytics and data science to examine the most interesting projects in web3. I'm proud to announce that Variant is doubling down in this domain by bringing on our first full-time Data Scientist, Chris Lepensky. Chris join us from 0x, a DeFi exchange protocol that has done over $100B in trade volume, where he led data science for Matcha and provided key insights that drove strategy across both protocol and product. He will be doing the same type of work alongside our portfolio companies, as well as supporting our broader investment efforts at the firm, so I’m extremely excited to welcome him to the team!

Network coverage:
Coverage on Solana and Magic Eden.

① Solana

👥 Jimmy Zheng (Artemis)

📈 Solana NFT marketplace use remains strong at 512k MAUs

  • Solana has seen continued development over the past year despite the overall crypto drawdown, with NFT Marketplace activity demonstrating considerable resiliency. While TVL has steadily contracted from $7b at January 2022 to $1b at November 2022 (85% decline) and daily active addresses fell from a peak of ~4m in May 2022 to ~500k in November 2022 (~88% decline), Solana has seen much gentler declines in NFT activity, from both a daily active user and a daily volume perspective over 2H 2022.
Source: Artemis
  • Solana NFT marketplaces saw ~5.4m SOL volume at its peak in May 2022, which declined to ~4m SOL in Sept and ~3m SOL in Oct 2022, (~25% and ~45% decline vs. May volumes). Daily Active Users have declined from 1.4m in May 2022 to 1.2m in Sept and 1.1m in Oct, (~12% and ~20% decline vs. May volume).
Source: Artemis
  • Solana NFT Marketplaces have held up well against the backdrop of declining DEX and stablecoin activity. SOL saw $2b of stablecoin outflow in September and October 2022, alongside a ~90% decline in DEX volumes from May to October 2022 but only saw ~45% decline in NFT Marketplace volume over the same period.
Source: Artemis

② Magic Eden

📈 Magic Eden defends its ~99% market share

  • Magic Eden is the leading NFT marketplace on Solana. The project had consistently tracked ~98%+ market share over the past year, but fell to ~75-80% when its competitor Solanart gained traction after enabling optional creator royalties in August. In response, Magic Eden announced optional royalties in mid-October, and their market share almost immediately returned to previous levels. It should also be noted the chain announced its multi-chain support for Ethereum.
Source: Dune Analytics - @chuxin
  • Zooming out, Solana NFTs gained traction relative to Ethereum in September. At a weekly peak, Solana controlled ~35% of total NFT volume across all chains. While the chain has recently seen a downturn in volume, its market share of NFT volume vs Ethereum still remains elevated compared to pre-September levels. Much of this volume was driven by the surge in Solana NFT mints, which surpassed 300k on September 8.
Source: TheBlock
  • Magic Eden volumes have seen a notable drawdown, but users remain almost just as active as April / May ATHs. DAU are tracking ~10-15k, down only ~3k from May highs of ~18k. Additionally, daily average transactions per user have only fallen ~0.5 from May levels to ~3.0 / day.
Source: Dune Analytics - @derekw23