Solana, a Layer 1 network, is experiencing a surge in new users as Ethereum and Bitcoin face higher transaction fees. Data from The Block reveals that Solana’s average daily new addresses reached 304,640 on Monday, marking the highest number since June 2022. In fact, more new addresses have been added in the first half of May than the entire month of April combined.
The rise in Solana’s user base coincides with a period of elevated transaction fees on Ethereum and Bitcoin, which reached three-month highs last week. Consequently, the number of active addresses on the Bitcoin network that have sent or received funds has dropped to its lowest level since July 2021.
According to Rebecca Stevens, a research analyst at The Block, the increase in new addresses on Solana began in early May when fees started to rise on Ethereum. Additionally, the recent Ethereum network issues, including temporary block finalization halts, may have contributed to users seeking alternatives like Solana. Similar growth in new addresses is observed across Ethereum-scaling platforms such as Polygon.
Despite previous challenges faced by Solana, including outages and the collapse of the FTX crypto exchange, its native token SOL has demonstrated a remarkable recovery, rising 109% year-to-date. While experiencing a slight decline of 0.9% on Tuesday to USD 20.78, it has shown a 0.6% increase this week, according to TradingView data.