Emre Yumlu 
Crypto banking firm Sygnum has stated that Solana is not yet positioned to surpass Ethereum as the preferred platform for institutional adoption. According to the company, Solana’s revenue model heavily relies on memecoins, which could limit its long-term appeal to serious investors.
Institutions Still Trust Ethereum
In its May 8 analysis, Sygnum acknowledged that current sentiment around Ethereum is weak, but emphasized that its security, stability, and long-standing presence still make it the go-to choice for traditional financial entities.
“We don’t see convincing indicators that Solana is ready to replace Ethereum at the institutional level,” the report noted.
Concerns Over Solana’s Revenue Composition
Although Solana has seen a spike in transaction volumes and network fees in recent months, Sygnum argues that much of this activity is tied to the memecoin sector, making the income generated appear volatile and unsustainable.
“The concentration in revenue sources creates a challenge for Solana to consistently outperform Ethereum.”
Additionally, it’s pointed out that most of Solana’s transaction fees go to validators, with limited direct impact on SOL’s token value.
Tokenomics Present a Mixed Picture
Solana’s tokenomics may be more adaptable than Ethereum’s, but this flexibility isn’t being fully utilized. In March, the Solana community voted against a proposal to reduce SOL’s inflation rate, signaling a reluctance to prioritize long-term token value growth.
Ethereum, meanwhile, is dealing with criticism over stagnant mainnet activity, largely due to the low-cost incentives for its layer-2 ecosystem. However, Sygnum notes that Ethereum still generates 2 to 2.5 times more revenue than Solana.
Transactions on Solana (purple) far exceed those on Ethereum and its layer 2s, but the latter has more value locked onchain.
Solana’s Path Lies in Sustainable Use Cases
Sygnum believes Solana could close the gap with Ethereum if it shifts its focus toward tokenization and stablecoins — areas where institutional interest and regulatory clarity are stronger, and where Ethereum currently dominates.
Still, Solana has made noticeable gains in the total value locked across DeFi protocols, reflecting growing user adoption. If these gains are paired with more stable revenue streams, the network could strengthen its competitive position.
Lastly, Ethereum’s recent strategic shift back to layer-1 development may help restore market confidence after a prolonged period of underperformance relative to Solana.
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