Introduction
Warren Buffett's mentor Benjamin Graham is famous for teaching, and I paraphrase, a stock can go down fifty percent for no reason whatsoever. Solana (SOL-USD), the seventh largest cryptocurrency based on a market cap of $48 billion, meets that criteria, but not without just cause. First, most cryptocurrencies are experiencing Crypto Winter. Secondly, software in general is in a free-fall. Third, so goes Bitcoin (BTC-USD), so goes the crypto market and Bitcoin is down close to 50% from the all-time high. There's a correlation with digital assets and Bitcoin. Fourth, and in the short-term, Operation Epic Fury is putting a lot of pressure on stocks and digital assets. Fifth, the S&P 500 corrects 10% every 14 months based on historical data. We may be in the midst of a garden variety pull back. Painful, but necessary to consolidate the market. Finally, it was extremely overvalued after momentum traders bid up the price in the Fall of 2025.
At the time of this writing, Solana trades at $85 a token, down 65% from $247 five months ago. Prone to boom/bust cycles, it's descending, going in the wrong direction if you're long the Solana Blockchain. My opinion is that this a good time to dollar-cost-average if you own it, or an even better time to take a position in it.
Some Background and Total Addressable Market
The Competition
Currently, there's a battle between the more established Ethereum (ETH-USD) and the newcomer Solana to capture the lion's share of tokenized assets flowing through their blockchains. Other players in the cryptosphere, such as Avalanche (AVAX-USD) and Cardano (ADA-USD), have promise but lag in market dominance. Although Cardano and Avalanche have outstanding growth rates, revenues are in the millions of dollars, not billions of dollars, as are Solana and Ethereum. Ethereum is the industry standard in DeFi, with 56% market share last year. Most of Solana's revenues are derived from the gaming, social media, and meme coins. Solana's market share in DeFi varies on the source, but a ballpark figure is approximately 12%. Clearly a distant number two to the leader, Ethereum.
| Blockchain | 2025 Revenue | 2026 Est. Revenue Growth | Key Growth Driver for 2026 |
| Solana | $2.39 Billion | 40% – 55% | Firedancer upgrade & Perp DEX expansion |
| Ethereum | $5 Billion | 15% – 25% | L2 Interoperability & Institutional RWAs |
| Avalanche | $207 Million | 30% – 45% | Real World Asset (RWA) Subnets |
| Cardano | $18 Million | 50% – 70% | Ouroboros Leios & Midnight Privacy Layer |
I believe the estimated 2026 growth revenue on the table above can be misleading because it's not an apples to apples comparison between Ethereum and Salona. Ethereum is still in pole position with DeFi tokenization and has a huge lead. Although Ethereum is slower than Solana in processing transactions, it's much more secure and has first-mover advantage. Established financial institutions prefer Ethereum. After all, when you're dealing with money, security is the name of the game.
Solana receives a majority of its revenues via the retail trade, not DeFi. This means meme coins. A joke to many on Main Street, but no laughing matter to Solana. In 2025, trading and meme coin activity constituted about 50% of Solana's revenue. Ethereum isn't going anywhere, either. It's the number two crypto in a universe of thousands of digital assets, right behind Bitcoin. Ethereum has the same Total Addressable Market as Solana to capture. Both should experience tremendous growth in the next five years. Currently, it's a Coke (KO) and Pepsi (PEP) battle. Coke, like Ethereum, dominates in the global market in DeFi. Solana, like Pepsi, is the clear runner-up but has terrific products. Neither Solana nor Ethereum are meme coins such as Dogecoin (DOGE-USD), Trump ($TRUMP-USD), or Bonk (BONK-USD).
Although buying cryptocurrency can be considered gambling, I think of it an investment if you choose the right tokens. Solana and Ethereum are the plumbing for the infrastructure of WEB 3.0. In the not-so-distant future, both of these blockchains, along with crypto oracle Chainlink (LINK-USD), will be in the lexicon of Main Street investors. The utilitarian aspect of crypto is in a current period of consolidation. This is similar to the turn of the Twentieth Century, when there were over 100 automobile manufacturers, only to be dwindled down to a handful by 1920. This is happening now to crypto that actually does something.
Why Solana?
Solana is a high risk, high reward investment. Even at the depressed price, it's still expensive by utilizing traditional metrics on an absolute basis. On a relative basis, it appears to be less expensive than competitor Ethereum and most in the cryptosphere. Ethereum has a market cap of $240 billion, with 2025 revenues at $5 billion and only projected to grow 15%-25% this year. Solana has one fifth the market cap, and although it has half the revenue of Ethereum, it is growing close to 50%. Both are over their skis in traditional value investing, but we're in a bull market and investors will pony up for growth. Like Benjamin Graham, I prefer a margin of safety, but Graham lived way before the technological revolution.
| Metric | Solana | Ethereum |
| Current Price | ~$85.30 - $88.89 | ~$1,900 - $1,980 |
| Developer Activity | ~2,500 - 3,000+ active devs | ~5,000 - 6,000+ active devs |
| Monthly Revenue | $245 Million (Jan 2026) | $89 Million (Jan 2026) |
| Daily Active Addresses | ~2.17 Million | ~682,000 |
| Total Value Locked | ~$6.4 Billion | ~$52.4 Billion ($65B+ incl. L2s) |
| DEX Trading Volume | ~$108 Billion (last 30 days) | ~$63.7 Billion (last 30 days) |
Solana has 3,000 active developers on the network and that figure is growing. The additional programmers could help Solana chip away at Ethereum's dominance in DeFi. One example is BlackRock's (BLK) blockchain money market token, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL-USD). Originally on Ethereum, it's now on Solana and other blockchains, too. More could follow in jumping ship, and go with the upstart Solana. As reported in MEX.CO "As of early 2026, the competitive landscape between Solana and Ethereum has shifted from a theoretical debate to a data-driven rivalry. While Ethereum remains the "reserve currency" and institutional bedrock of DeFi, Solana has aggressively captured market share in terms of retail engagement, transaction volume, and capital efficiency."
In the opening paragraph, I gave a list of reasons why Solana has depreciated in price recently. Most of these reasons investors have no control over: war, market corrections, or overvaluation. Investors also have no control over government intervention. However, a legislative act that's up for vote in The Senate, could be a major catalyst to boost, or, buoy the price of Solana and crypto in general. This is the Clarity Act which has already passed in Congress. The Clarity Act aims to put guardrails on cryptocurrency, strengthening oversight and protecting investors. This past week, President Trump posted on Truth Social, that he supports the Act, and crypto prices rose 5%-7% in one day unison. If it becomes law, we may be off to the races. No matter how you feel about The Commander in Chief, his posts can move the market.
Another thing to consider is what's happening in the Artificial Intelligence space with Open AI's ChatGPT, Anthropic's (ANTHRO) Claude, and Google's (GOOG) Gemini. They change leads by the day. Technologies leapfrog each other in the bat of an eye. This could be the situation with Ethereum and Solana if developers continue flocking to Solana to develop DeFi. However, Ethereum's developer community is growing, too.
How To Invest in Solana
In the early days of crypto, the only way to invest was through a digital wallet on crypto exchanges such as Coinbase (COIN) and Binance. They can get hacked, tokens can get lost, and they are far from plug-and-play in terms of ease of use. Crypto purists prefer to use them. In the past few years, discount brokers such as Robinhood (HOOD) and Interactive Brokers (IBKR) introduced crypto trading on their exchanges. Not all discount brokers allow crypto trading, so check with whoever it is you invest with.
More recently, the way I prefer to play it is by using spot-priced ETFs. These ETFs have only been on the market for a few months and are very risky, just like buying cryptocurrencies in general. Spot-priced crypto ETFs are regulated under the Securities Act of 1933, which means they are registered with the SEC and subject to anti-fraud provisions. One caveat is that these ETFs are not registered under the Investment Act of 1940, and therefore are not subject to the same regulations and protections as 40 Act ETFs and mutual funds. You could lose everything, but if you're venturing into cryptocurrencies such as Bitcoin (BTC-USD), you probably are already aware of that. If the Clarity Act, which aims to regulate the digital asset market, passes in the Senate, then these ETFs should be much safer investments.
Here's a list of some of the many Solana spot-price ETFs:
- Grayscale Solana Staking ETF (GSOL), 0.35% expense ratio.
- Bitwise Solana Staking ETF (BSOL), 0.2% expense ratio.
- VanEck Solana ETF (VSOL), 0.3% expense ratio.
Conclusion
This is a heavyweight fight. Just like Muhammed Ali vs Joe Frazier back in the day. Not just a boxing match but a clash of cultures. The whole world is watching, too. The global DeFi market is expected to grow at a Compound Annual Growth Rate [CAGR] of 21.8% to 68.2% in the coming years, with 2026 appearing as a key year of high growth. With a huge Total Addressable Market, this is a place you can make a lot of money, especially at these distressed prices. Solana has near-term momentum in the cryptosphere and is gaining market share. The Clarity Act is set to become law. Solana's price is under pressure. For 2026, Solana is projected to experience a 40%-55% revenue growth rate. Because of these factors, I believe that Solana is a good bet for the next year and beyond.
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