The competitive landscape is shifting as Ethereum strengthens its position through Layer-2 networks like Arbitrum, Base, and Optimism. Combined, Ethereum’s share of DEX activity has risen significantly, cutting into Solana’s dominance and contributing to SOL’s recent bearish sentiment.

At the same time, Solana’s network fees dropped 42% since January due to reduced trading activity. While it still generates strong fee revenue, the rise of cheaper and scalable Ethereum Layer-2 solutions is reshaping where users and liquidity are flowing.