Uptober is finally upon us. But as Bitcoin’s price picked up, the real standout price action this month has once again come from Solana. The high-performance chain is the main hub for this cycle’s biggest narrative: meme coin trading. Retail traders enjoy the speed, ease of use, and ‘straightforwardness’ of Solana’s trading experience. The fact that popular meme coin launchpads are on Solana just furthers this virtuous cycle. Recently, Solana’s total volume has surpassed that of Ethereum and its Layer 2s price combined. No wonder Solana’s year-to-date price performance has blown both Ethereum and even Bitcoin out of the water.
A Shift in Market Dynamics: Solana’s Rise and Ethereum’s Struggles
This price movement also highlights another market development: the old paradigms are dead. Bitcoin’s rallies were supposed to be followed by Ethereum and then by other Alts. If Ethereum underperformed, Alts were supposed to be crushed. Yet, the tides have turned entirely. Solana has continuously outperformed Ethereum in this cycle so far. Memecoins have been flying, regardless of Ethereum. Meanwhile, Bitcoin, driven by ETFs and institutional adoption, has continued to move in a ‘weight class’ of its own. The old paradigm is dead, long live the new one?
One of the main challenges for Ethereum in this cycle has been its inability to shape a strong, coherent narrative. While Solana’s thesis can be broken down to ‘fast casino = gud’, Ethereum’s complex roadmap, countless Layer 2s and even Layer 3s, and deeply technical conversations have turned away a lot of regular users. Undoubtedly, Ethereum continues to command a lot of developer mindshare. It also comes closest to institutional adoption for smart contract use cases thanks to its technological maturity. Impressive technical progress is being made toward user-experience improvements such as account and chain abstraction which will make Ethereum easier, faster, and better for all users. But if this can already translate into positive price action this cycle remains to be seen.
On the wider macro side, markets remain hopeful that a breakthrough can finally happen to new Bitcoin all-time highs. The upcoming US elections and continuing wars in Eastern Europe and the Middle East provide for both greed and despair among traders. A more pro-crypto administration post-US elections and an end to the wars could ignite a firework. But right now events could turn in either direction. For now, the markets are optimistic, yet also at the whim of a coin flip. Happy trading everyone!
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