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 Could “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 at present “overtaking” its older rival in mind-share if not in absolute fundamentals.
“Ethereum’s strategic pivot […] has led to a 5–10 percent outperformance of Ether over Solana,” the be aware observes, citing the chain’s refocused roadmap on main-net scalability and user-experience. Nonetheless, the authors concede that “sentiment on Ethereum remains poor for now” regardless of its “continued leading position and still superior revenue generation.”
Sygnum’s analysts dissect the often-conflated metrics of charges, revenues and token worth. Whereas Solana has not too long ago “dominated in fee generation,” its protocol revenue “continues to substantially lag Ethereum (with the exception of the brief period around the issuance of the Trump family 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 therapy. The report reiterates that rollups have “led the market to see Ether as less valuable,” however provides a little-noticed parallel: “a comparable issue affecting the value of the Solana tokens is overlooked.” As a result of “most of the fees are paid to validators and do not grow the value of the Solana token,” Solana’s personal financial premium could also be equally weak.
Token-economic self-help is just not on the quick horizon: a group proposal to tweak Solana’s inflation schedule—an initiative Sygnum says “would have had a similar effect” to ETH’s fee-burn mechanic—“was conclusively voted down recently.”
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 “more room for Solana to outperform – especially with the tailwind of a better narrative and sentiment.” Even so, the report cautions that Solana’s revenue stream is “highly concentrated in the memecoin sector” and therefore judged by buyers as “less stable.” The implication: valuation reductions could also be rational somewhat than sentimental.
By The Numbers
Ethereum’s entrenchment amongst regulated establishments offers the counter-weight. “Tokenisation, stablecoins, and DeFi” are the use-cases “showing traction and have the support of governments, regulators, and traditional financial institutions,” Sygnum writes, noting Ethereum’s 57% share of tokenised belongings—augmented by an extra 20% on its Layer-2 cohort zkSync. BlackRock’s flagship BUIDL fund, for instance, retains “93% of its assets on Ethereum,” a choice the asset supervisor hyperlinks to the community’s “decentralization, credibility and security.”
Against this, Solana’s slice of the tokenisation pie “remains below 3%,” and its year-to-date doubling of stablecoin share leaves it “just above 5%,” nonetheless an order of magnitude behind Ethereum. The realm the place Solana has moved the needle most convincingly is DeFi complete 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 continue to strongly favour Solana,” Sygnum concedes, even after Ethereum Basis’s inner reshuffle and public vow to “adjust its go-to-market strategy and to clarify and articulate the value proposition.” But narrative alone won’t determine custody mandates or settlement rails for conventional finance.
“We do not yet see convincing signs that Solana would be the preferred choice as Ethereum’s security, stability and longevity are highly prized,” the financial institution concludes, reminding readers that community results in crypto “are very hard to overcome – just as they are in other tech fields such as social media.”
Certainly, historical past’s roll-call of “Ethereum killers” is a cautionary story: “most have faded away until now,” regardless of technological ingenuity. In opposition to that backdrop, the report’s abstract is each sober and hanging: “Ethereum’s 2-year long underperformance vs Solana has been temporarily arrested since the strategic pivot… [and] the token value continues to be supported by revenues running at double the rate 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 focused on Solana’s greater transaction volumes,” even when “protocol revenues continue to substantially lag Ethereum.” Within the scorecard of Could 2025, Solana might declare the gang, 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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