Here’s a comprehensive breakdown of the recent narrative around Solana (SOL) “losing 97% of traders” and institutions pulling back — what’s true, what’s exaggerated, and what it means for the market:
yellow.com
Coinpaper
Solana Loses 97% Of Traders During 2025 As Institutional Money Exits | Yellow.com
Solana ETF Hits $608.9M in Inflows as Total SOL Traders Drop 87% From January Highs
December 17
📉 Why People Are Saying Solana Lost 97% of Traders
On-chain data shows that Solana’s network activity — as measured by monthly active traders — has fallen dramatically compared with its peak in 2024:
Monthly active traders reportedly fell from ~30 million+ to under ~1 million in 2025 — roughly a 97% decline in that specific metric. �
yellow.com
Network revenue also fell substantially year-over-year and meme-coin trading, which previously drove much of Solana’s activity, evaporated. �
yellow.com +1
Total Value Locked (TVL) and decentralized exchange (DEX) volumes are far lower than during peaks earlier in 2025. �
AInvest
So what’s really going on?
➡️ This 97% figure refers to one particular metric (monthly active traders), not the total number of holders or ecosystem users. It’s not the entire Solana ecosystem “dying”, but a steep contraction in short-term speculative activity.
🏦 Institutional Activity: Mixed Signals
Despite headlines claiming institutions are abandoning Solana:
Some institutional involvement is still happening:
Solana-linked institutional products like Solana ETFs (e.g., Bitwise and others) have seen significant inflows, showing continued interest from certain institutional and regulated investors. �
Coinpaper
Other new institutional vehicles are being launched which provide compliant exposure to SOL. �
CryptoRank
However:
Many whales and corporate treasuries have reduced their SOL exposures, and larger wallets are less active compared with the retail segment. �
FX Leaders
Conclusion: Institutions aren’t universally exiting — some are pulling back from active trading, while others are entering via regulated products.
🔍 What’s Driving the Decline in Activity?
Several factors have contributed:
1. Memecoin Boom to Bust
Solana’s activity in 2024–early 2025 was heavily driven by meme-coin speculation.
Once that mania faded:
DEX wallet activity dropped sharply.
Meme-coin share of volume fell from ~70% to under ~10%. �
yellow.com
2. Speculative Traders Left
Retail and short-term traders have largely shifted to other opportunities, reducing churn and active participation.
3. Market-Wide Crypto Weakness
Solana’s decline parallels broader market contraction — not just internal issues. Other major assets like Ethereum and Bitcoin have felt pressure. �
yellow.com
4. Data Interpretation Differences
Metrics vary based on how they’re measured (active traders vs. active addresses vs. DEX volumes). Some sources show larger declines than others, but the trend of decreasing speculative turnover is consistent. �
CCN.com
📊 Is Solana Actually “Dead”?
No — the situation is nuanced:
✅ Positive factors still in place
Solana’s technical performance (speed, low cost) remains strong. �
Bitget
Developer activity and ecosystem tools continue to grow, indicating long-term interest from builders. �
AInvest
Regulated investment products (ETPs/ETFs) continue to attract capital. �
Coinpaper
⚠️ Negative short-term signals
Speculative psyche and short-term trading engagement have collapsed relative to 2024 peaks.
Liquidity and TVL are down from highs — typical of a mid-cycle market correction.
📌 So What Does This Mean for Investors?
Short-term
Expect higher volatility and thinner markets. Reduced speculative participation often leads to:
Wider bid-ask spreads
Bigger price swings on less volume
Liquidity droughts that amplify moves
Medium to Long-term
Focus is shifting from casino-style trading to real utility, institutional adoption, and real world use cases:
Solana’s core infrastructure and developer ecosystem remain competitive.
Institutional interest via regulated products suggests durable demand outside speculative trading.
📊 Summary in Plain Terms
Category
Status
Active Speculative Traders
Dramatically declined (~97%) 📉
Institutional Outflows from Trading
Occurring, but balanced by ETF/ETP inflows 🧮
Developer Growth
Still positive and strong 📈
Network Fundamentals
Mixed — efficiency good, usage lower 📊
Investor Narrative
Shift from memecoins to long-term utility
If you want, I can break this down into either investment implications or a timeline of Solana’s activity changes through 2025 — just tell me which one you prefer.
