Why did SOL significantly underperform ETH and HYPE during this downward phase, but I still believe it has long-term investment value?

Let’s first look at the most straightforward price results. Based on current market data, SOL is approximately around $83, down about 71.5% from its all-time high of $293.31; ETH is around $2,322, down about 52.9% from its all-time high of $4,946.05; HYPE is about $44, only about 25% below its all-time high of $59.30. So the question is no longer “Is SOL weak?” but rather: why, in the same bear market, is SOL so much weaker than ETH and HYPE? My answer is: SOL loses in valuation framework, not entirely on-chain activity.

The first reason is the asset preference shift in the macro environment. The Solana Foundation itself clearly stated in its February 2026 ecosystem report: the main theme that month was rising global tariffs, risk asset contraction, industry de-leverage, and a cooling of high-frequency trading volume; Reuters’ tracking since 2026 also shows that tariff threats, geopolitical conflicts, and risk appetite fluctuations continue to dominate the pricing of high-risk assets, including crypto assets. In such an environment, the market typically cuts high-beta, narrative-driven, trading-oriented assets first, rather than cutting “institutional entry points” or “cash flow more transparent” assets. SOL is in a particularly awkward position: it is neither an institutional core holding like ETH nor a cash flow machine like HYPE, so when risk appetite declines, it is more easily undervalued.

The second reason is that Solana’s on-chain revenue, while not bad, is not “pleasing” enough in a bear market. DefiLlama’s latest data is interesting: Solana’s current 24-hour on-chain fees are about $531k, on-chain revenue about $55k, app revenue about $2.4 million, 24-hour DEX trading volume about $8B, which is not bad; but the same page also shows that its 7-day DEX trading volume has decreased by 10.75% week-over-week, and 7-day Perps trading volume has decreased by 15.21%. The official Solana report also admits that during macro contraction, retail-driven and high-frequency trading-driven transactions are cooling down. This raises a very practical question: the market may think that although Solana’s revenue is high, a significant portion is driven by trading heat, memes, and short-cycle speculative behavior, so in a bear market, it is not willing to assign high multiples.

The third reason is that ETH is strong, not just in on-chain activity, but also because of a stronger narrative of “institutional entry + stablecoins/tokenized underlying assets.” Ethereum’s current 24-hour on-chain fees are about $342k, on-chain revenue about $86.9k, active addresses about 824k, and stablecoin market cap about $166.96 billion; its 7-day DEX trading volume has increased by 4.67% week-over-week, and 7-day Perps trading volume by 7.39%. More importantly, from April 6 to April 10, U.S. spot ETH ETF net inflows were about $187 million, with total net inflows of approximately $11.67 billion, and net asset value about $12.96 billion. Reuters also cited Citi’s view in March that, although ETH is sensitive to user activity, stablecoins and tokenization could still be important supports. In other words, ETH’s current valuation is not just a “public chain coin,” but more like a foundational asset for institutional capital participation in on-chain finance and tokenization. In a bear market, capital naturally prefers to return to such assets.

The fourth reason is that HYPE’s strength is more direct in the “income—buyback—price” closed loop than SOL. DefiLlama shows that Hyperliquid’s current 24-hour revenue is about $2.51 million, 30-day revenue about $56.54 million, 24-hour Perps trading volume about $531k, and 7-day Perps trading volume about $55k; official HYPE documentation states that HYPE’s staking rewards come from future emission reserves, not by packaging “staking yields” as protocol revenue. Meanwhile, 21Shares’ HYPE product documentation explicitly states that Hyperliquid will use over 95% of its revenue for daily open-market repurchases of HYPE. This means that, in the market’s view, HYPE is more like a high-cash-flow, strong buyback, and deflationary on-chain exchange stock. CoinShares’ weekly report on April 7 even listed Hyperliquid as a tracked asset, albeit small in scale, with inflows already positive for the year. In contrast, SOL’s value capture is not as direct.

The fifth reason is that SOL’s ETF story has made progress but has not yet formed an institutional moat like ETH. The Solana official report mentioned that in February, U.S. domestic Solana ETFs experienced over 12 consecutive days of net inflows, with total inflows exceeding $900 million; Reuters also reported that Morgan Stanley applied to the SEC in January 2026 for an ETF linked to Bitcoin and Solana; and after the SEC approved new general listing standards in September 2025, the listing path for more spot crypto ETFs was significantly simplified. The problem is: SOL’s ETF is a “story in formation,” while ETH’s ETF is a “mature asset allocation channel.” In a bear market, the market prefers already mature channels rather than newly established ones.

The sixth reason, and the easiest to overlook, is that SOL is not without fundamentals; in fact, fundamentals and price are misaligned. Solana’s official February 2026 report lists very solid data: SOL-denominated TVL hit a new high, surpassing 1.85B SOL; RWA market cap rose to $1.71 billion; stablecoin supply approached $15 billion; in February, stablecoin trading volume reached $650 billion; BlackRock’s BUIDL on Solana exceeded $550 million; Citigroup completed a full trade finance pilot on Solana; SoFi launched native Solana deposits. This shows that Solana is not just memes; it is transforming from a “high-frequency trading chain” to an infrastructure for “payments, RWA, institutional finance.” However, the market has not yet fully believed that this new narrative can take over the income and valuation of the old narrative.

The seventh reason is that the long-term technical roadmap still leaves a lot of imagination for SOL. The Solana Foundation confirmed at Breakpoint 2025 that Firedancer has officially gone live on mainnet, and Solana is no longer a single-client network; Anza’s official blog also states more directly: Alpenglow will replace the old components TowerBFT and Proof-of-History, aiming to bring actual finality down to a median of about 150 milliseconds, sometimes close to 100 milliseconds. This is not a price story but a performance story. In other words, SOL’s long-term value has not been destroyed; it is even being enhanced. What has been destroyed is the short-term market willingness to pay high valuation multiples.

My own final conclusion is: SOL’s current weakness is more like “valuation compression + capital preference shift,” rather than “fundamentals collapse.” In the short term, it is indeed weak because the market in a bear market is reluctant to assign high weight to “high beta + retail trading-oriented” assets; while ETH benefits from ETF and stablecoin/tokenization narratives, and HYPE benefits from high cash flow and strong buybacks, both of which are easier to attract capital than SOL. But if we extend the cycle, Solana’s progress in payments, stablecoins, RWA, on-chain institutional finance, client diversity, and low-latency performance is real. I agree with you: short-term weakness is a fact, but long-term investment value still exists. This kind of value is better understood through “medium- to long-term positioning + waiting for the market to re-assign growth premiums,” rather than expecting it to immediately become a cash flow-focused rally like HYPE in a bear market, or to immediately benefit from mature institutional capital like ETH.