Solana network activity plunges to 2024 lows amid user decline

Solana (CRYPTO:SOL) network activity has reached its lowest levels of 2024 as August nears its end, with a significant drop in transaction volume and active addresses. 

The Layer-1 network has experienced a decline of over 50% in both network fees and revenue, reflecting reduced demand and usage.

This month, the number of unique addresses participating in transactions on Solana has fallen to 18.09 million, marking a 67% decrease from the 54.33 million active users recorded in July. 

Additionally, the count of unique first signers, or new users, has dropped by 66%, totaling 11.1 million compared to a year-to-date high of 33.15 million in July. 

Despite recent interest in Solana-based projects like Pump.fun, this sharp decline highlights a significant reduction in network activity.

The decrease in user engagement has also led to a drop in non-vote transactions, which involve activities such as token transfers, staking, and NFT sales. 

Since the start of August, non-vote transactions on Solana have totaled 486.61 million, the lowest for the network this year. 

This decline has significantly impacted Solana's revenue and fees, which have plummeted by 62% over the past 30 days, according to data from Artemis.

SOL has been consolidating within a range since mid-August, facing resistance at $152.12 and support at $137.65, with its Relative Strength Index (RSI) indicating a balance between buying and selling pressures. 

If SOL breaks above the resistance level, it could see a 10% increase, potentially reaching $160.09.

Conversely, if selling pressure intensifies, SOL may drop below support to around $133.64.

The ongoing decline in network activity and user engagement poses challenges for Solana as it navigates a period of reduced demand and market consolidation.

At the time of reporting, the Solana (SOL) price was $154.76.