Key Insights from the Coinbase Institutional Report on Solana’s Transaction Fees and Network Activity

Solana Surpasses Ethereum in Transaction Fees, Network Activity Peaks During US Pacific Time Zone Hours

Solana has taken the lead in cryptocurrency trading fees, surpassing Ethereum in transaction fees generated from trading activities, according to a new report from Coinbase Institutional. The analysis shows that between 75% and 90% of Solana’s transaction fees come from decentralized exchanges (DEX), compared to Ethereum’s 55% to 65%.

The report, authored by Coinbase Institutional Research Analyst David Han, highlights a clear trend in user behavior, with peak network activity occurring during US Pacific Time Zone hours. Network usage reaches its highest point at 1:00 PM PT, indicating a strong user base on the West Coast.

Data from the report also reveals that a small percentage of active accounts on Solana, just 0.13%, generate 90% of non-vote transaction fees. This concentration of fees reflects similar patterns seen on other low-cost blockchain networks.

Solana’s growing popularity in the trading space can be attributed to its expanding ecosystem, which includes memecoins, gaming applications, and Decentralized Physical Infrastructure Networks (DePINs). The platform’s ability to process transactions quickly and at lower costs has attracted both retail and institutional traders.

Technical differences between Solana and Ethereum, such as Solana’s instruction-based transaction system versus Ethereum’s sender-recipient model, contribute to Solana’s performance. The report also highlights significant improvements in Solana’s operational efficiency, with failed transactions dropping to 26% in Q3 2024 from 55% in March.

Overall, Solana’s competitive fee structure, network upgrades, and expanding user base have positioned it as a leader in the cryptocurrency trading space. The platform’s alignment with US West Coast business hours suggests a concentration of crypto firms and trading desks in that region, further solidifying its position in the market.