Author: Lily Liu, Chair of the Solana Foundation

Compiled by: zhouzhou, BlockBeats

Editor's note: This article reveals the EVM bias in the a16z report, overlooking Solana's outstanding performance in transaction fees, NFTs, and the DeFi market. Despite Solana ranking high in NFT addresses and trading volume over the past year, the report fails to mention significant innovations in DePIN, such as Helium and Hivemapper. These groundbreaking projects demonstrate the real-world applications of decentralized networks, especially thriving within the Solana ecosystem, leaving us optimistic about the future.

Here is the original content (for ease of reading, the original content has been reorganized):

I read the a16z report on the state of the crypto industry and gained a lot! While I primarily focus on areas outside of EVM, I always cherish the opportunity to learn about other innovations in the self-custody space. However, I noticed a certain implicit EVM bias in the report. Here are some of my observations:

The author sets the global framework as an opposition between EVM and non-EVM, creating a binary opposition that views ecosystems and developers choosing not to develop within EVM as 'others.' For instance, the visual representation of active addresses is misleading. Solana's monthly active addresses reach 100 million, exceeding Base's 22 million; however, the chart virtually equates the two. A more accurate approach would be to use a single bar chart, distinguishing EVM and non-EVM bars with different colors (if necessary). Additionally, the slide claims that 'Base and Solana' have the highest monthly active addresses, but attentive readers will notice that NEARProtocol's active addresses amount to 31 million, surpassing Base. Therefore, the title should be changed to '...Solana and Near are the most active.'

Now let's discuss metric selection. Our industry typically uses active addresses and total value locked (TVL) as standard benchmarks for ecosystems. However, I suggest measuring the activity, demand, and overall health of an ecosystem in a more meaningful way: transaction fees. Transaction fees directly reflect user participation in valuable economic activities, their willingness to pay for execution, and validators' profit-making ability.

With Solana introducing a fee market, we can now distinguish the economic value of different types of activities within the ecosystem and apply this approach to other ecosystems.

In terms of transaction fees, Solana has made significant progress. Before December 2023, Solana's monthly transaction fee market share never exceeded 1.5%. Since April 2024, this percentage has consistently remained above 10%, peaking at 25% in July. When we consider MEV tips to measure 'real economic value' (REV), Solana is closing the gap! The chart from blockworksres highlights the narrowing REV gap between Solana and Ethereum.

This is another EVM-centric perspective related to the gaming sector. Using mgas/s as a metric to evaluate gaming infrastructure excludes Solana and other non-EVM networks, leading to meaningless comparisons that only give us a partial view of the blockchain gaming ecosystem.

Another example relates to DeFi. TVL as a metric for comparing DeFi activity is insufficient, especially in key categories like DEX, derivatives, and bridging, where trading volume is more relevant. While the report emphasizes overall DEX trading volume, it provides a protocol breakdown solely based on TVL, overlooking critical aspects of liquidity activity.

TVL often favors ecosystems with substantial asset reserves but limited liquidity, such as Ethereum. Although Solana's TVL only accounts for 10% of Ethereum's, its monthly DEX trading volume fluctuates between 50% and occasionally exceeds Ethereum. To accurately reflect on-chain economic activity, it is essential to focus on the economic value of transactions, not just the holding value. In this context, ecosystems with higher capital efficiency and superior on-chain performance stand out.

Among the comparable metrics across ecosystems, the report still primarily focuses on Ethereum and EVM L2. It regards the implementation of EIP-4844 as a crucial milestone for reducing industry fees. However, it is worth noting that since its launch in March 2020, Solana's transaction costs have also remained low. Moreover, regarding transaction affordability, Solana's median fees have consistently been lower and more stable than Base.

Although according to data from nftpulseorg, Solana ranked first in NFT addresses, second in trading volume, and fourth in unique collectibles over the past year, it has once again been excluded from this NFT comparison.

The slides mention that low transaction costs drive new consumption behaviors, which can be well illustrated by the example of Drip Haus. Since March 2023, the platform has achieved 182 million NFT mints, with a total cost of only 1,600 SOL (calculated at a SOL price of $150, each NFT costs only $0.001), as highlighted by Ledger Top.

The absence of DePIN is very evident. Helium is revolutionizing cellular networks, currently having over 1 million active hotspots in 182 countries. Hivemapper is utilizing a decentralized network for global mapping, recording over 7.5 million kilometers of street data in more than 50 countries. Rendernetwork offers decentralized GPU rendering services, providing critical computing power for industries like gaming and AI. This is an upgraded version of SETI@home, showcasing real application value.

More importantly, most of these innovations occurred in Solana rather than in the EVM ecosystem. Is this why DePIN was not mentioned at all in the report?