The lines between traditional finance and crypto finance continue to blur, and that's good news for blockchain networks such as Ethereum (ETH +3.34%). It has become the top crypto for decentralized finance (DeFi), and it's not even close.
However, top blockchain rival Solana (SOL +1.28%) is rapidly gaining on Ethereum. So much so, in fact, that I'm predicting that Solana will become the top crypto for decentralized finance by 2030.
Solana versus Ethereum
Ever since Solana launched back in 2020, it has been highlighted as a potential "Ethereum-killer." This is primarily due to the fact that Solana offers blazing-fast transaction processing speeds and cheaper costs. In November 2023, Cathie Wood of Ark Invest specifically pointed to Solana's disruptive potential.
Nearly three years later, Solana is finally starting to deliver on its early promise. Trading volume on its decentralized exchanges now surpasses that on Ethereum's decentralized exchanges. In large part, that's due to speculative trading in meme coins.
Image source: Getty Images.
However, it's not all about meme coin trading volume. According to one important DeFi metric -- total value locked (TVL) -- Solana is now tied with BNB (BNB +1.67%) as the second-leading blockchain network, with a 7% market share. That's well behind Ethereum's market-leading 53% market share, but it's proof that rivals are finally starting to chip away at Ethereum's longtime dominance.
Importantly, in high-growth areas such as stablecoins and real-world asset (RWA) tokenization, Solana has become the new go-to blockchain for top corporations and financial institutions. Case in point: When Moody's (MCO +4.54%) launched its new credit ratings for tokenized assets, it launched on Solana, not on Ethereum.
What will be the impact on Solana's price?
The big question, of course, is what Solana's growing prowess in DeFi means for its price. From my perspective, Solana is tremendously undervalued at a current price of just $70.
CRYPTO: SOL
Key Data Points
Back in October 2023, for example, investment firm VanEck calculated bear, base, and bull-case scenarios for Solana. In the base-case scenario, Solana was worth $335. In a bull-case scenario, Solana was worth more than $3,200.
While those price targets might seem wildly bullish in 2026, with Solana down 45% for the year, VanEck was very careful in laying out its assumptions. One of those was that Solana could find a "killer app" for DeFi that's capable of attracting 100 million users. In other words, Solana needs to find an app along the lines of ChatGPT, which skyrocketed to 100 million users in a matter of months.
That's a tall task, which is why I've dialed back my expectations for Solana. Right now, DeFi is all about speculation and yield extraction, as users deploy capital on a blockchain to generate higher returns than are possible in traditional financial markets. That means, in 2026, the average investor has very little reason to get involved with DeFi.
But if Solana ever finds a killer app for DeFi, all bets are off the table. Solana could finally be ready to topple Ethereum as the king of DeFi, leading to outsize returns for early investors.
