The State of Revenue on Solana: Blockworks (Dan Smith)

Trading has transformed Solana from a struggling blockchain into the network with the most revenue-generating applications in crypto. At Breakpoint 2025, Blockworks researcher Dan Smith delivered a data-driven presentation revealing that 60% of all Solana transaction fees now come from a single activity: trading.

Summary

Dan Smith's presentation at Breakpoint 2025 painted a compelling picture of Solana's evolution into what he calls "the everything chain" - a vision of Solana becoming the central hub for all global financial activity. The data supporting this thesis is striking: Solana now hosts more revenue-generating applications than any other blockchain, and it has maintained this lead since achieving it.

The presentation revealed that trading activity across spot and perpetual markets dominates Solana's economic output. This includes trading terminals, wallets, decentralized exchanges, asset issuers like Pump.Fun, and transaction landing services. These applications haven't just generated revenue - they've attracted the users, assets, and liquidity necessary to build a thriving ecosystem that's now attracting developers to build beyond crypto-native assets.

Perhaps most fascinating is the emergence of proprietary market makers (prop MMs), a new DEX design that has captured 60% of spot trading volume. These sophisticated market-making systems generate approximately 175 transactions per second - representing 20% of all Solana transactions - as they compete to offer users the best prices. This automated competition for liquidity is precisely the type of high-frequency activity that could scale dramatically as more assets come on-chain.

Smith's thesis culminates in a vision where Solana handles not just crypto-native assets, but tokenized equities, credit instruments, and other traditional financial products. If Solana succeeds in becoming the hub for global financial activity, the economic output of the world would directly correlate with on-chain transaction fees, creating a powerful value proposition for the SOL token.

Key Points:

Trading Dominance Drives Solana's Revenue

The data is unambiguous: trading is the killer use case driving Solana's current success. November 2024 data shows that 60% of all base and priority transaction fees on Solana come from transactions that include a DEX swap on the spot side. When perpetual trading is included, this percentage climbs even higher.

This trading ecosystem encompasses multiple categories of applications: trading terminals and wallets that provide user interfaces, spot and perpetual exchanges where trades execute, asset issuers like Pump.Fun that have fueled the meme coin phenomenon, and transaction landing services that help users achieve better success rates. Each of these business categories generates significant revenue while collectively creating the liquidity and user base necessary for ecosystem growth.

The Rise of Proprietary Market Makers

One of the most significant technical developments discussed was the explosive growth of proprietary market makers (prop MMs). These represent a fundamental evolution in DEX design where market makers provide proprietary liquidity directly to DEX aggregators, rather than operating their own front-ends. They use price oracles to actively manage liquidity and adjust prices without requiring trades to flow through the pool.

Prop MMs now handle 60% of all spot trading volume on Solana, a remarkable shift that has occurred over roughly 12 months. Smith presented data showing that prop MMs significantly outperform traditional constant product or concentrated liquidity AMMs in "markouts" - a measure of profitability that indicates how well they avoid toxic arbitrage flow. On the SOL-USDC pair, prop MMs showed substantially higher markouts over a 45-day period starting October 2024, demonstrating their effectiveness at flow segmentation and active liquidity management.

Transaction Composition and Network Load

The prop MM phenomenon has fundamentally changed Solana's transaction composition. A full 20% of all Solana transactions are now oracle updates from market makers adjusting their liquidity positions. This translates to approximately 175 transactions per second dedicated solely to market makers competing to provide users with the best prices.

Importantly, while these transactions represent a significant portion of network activity, they're highly optimized for cost efficiency. That 20% of transactions generates only about 2% of total transaction fees and tips. This efficient design is precisely what allows prop MMs to operate profitably while still providing competitive quotes. Smith emphasized this as evidence of the network's capacity to handle high-frequency financial activity at scale.

The Everything Chain Vision

Smith articulated "the everything chain" thesis as Solana becoming the hub for all global financial activity - every asset, every market, and every financial instrument type including spot, perpetuals, options, and beyond. Currently, prop MMs operate on roughly 30 to 50 crypto-native asset pairs, but Smith envisions a future where this scales to 5,000 or more assets.

This vision extends beyond crypto-native tokens to include tokenized equities, credit instruments, and other traditional financial products. Projects bringing ownership tokens onto Solana and efforts around tokenized securities represent early steps toward this broader financial ecosystem. Smith noted that 2024 and 2025 have proven this isn't a one-time phenomenon but a sustainable trend, creating a solid foundation for the next phase of growth.

Implications for SOL Token Value

The presentation concluded with perhaps the most significant implication: if Solana achieves the everything chain vision, the SOL token becomes extraordinarily compelling as an asset. As global economic output increases, on-chain transaction activity would grow proportionally, generating yield through transaction fee burns and staking reward distributions.

This creates a direct link between global financial activity and SOL token value - a fundamentally different value proposition than most blockchain tokens offer today. The network's demonstrated ability to handle high-frequency market-making activity at scale provides technical evidence that this vision is achievable, while the client teams' ongoing performance improvements suggest capacity will continue expanding.

Facts + Figures

• Solana hosts more revenue-generating applications than any other blockchain and has maintained this lead since achieving it

• 60% of all Solana transaction fees (base and priority) come from transactions that include a DEX swap on spot markets

• Proprietary market makers (prop MMs) now handle 60% of all spot trading volume on Solana

• 20% of all Solana transactions are oracle updates from market makers adjusting liquidity positions

• Approximately 175 transactions per second are generated by market makers competing to provide best prices

• Despite representing 20% of transactions, prop MM oracle updates account for only about 2% of total transaction fees and tips

• Prop MMs currently operate on approximately 30 to 50 different crypto-native asset pairs

• The prop MM explosion occurred over roughly the past 12 months

• Markout analysis shows prop MMs significantly outperform traditional AMMs on the SOL-USDC pair over a 45-day period

• Solana's 2024-2025 performance was described as "almost hilariously good" compared to previous years

Top quotes

• "The everything chain is the most compelling thesis of a blockchain in my mind. And I would describe that pretty succinctly as being the hub for all of global finance."

• "60% of all transaction fees, so base and priority fees that occur on Solana, come from transactions that include a trade."

• "175 transactions per second of Solana are being generated by market makers competing to provide users with the best price. That is what the everything chain is."

• "You can imagine a world where that 10, 20, 50 X's and there's now 5,000 different assets that are trading on Solana and market makers are competing to provide them the best quotes."

• "Being the hub for all of financial activity across the world, that's every asset across every market in any type of financial instrument, whether that be spot, perpetuals, options, or anything else."

• "If all of the world's financial activity is happening on Solana, as the economic output of the world increases, so does the transactions that happen on chain, and therefore the yield that the token generates."

• "That is what keeps me logging in every day. That is what keeps me coming back to the industry."

Questions Answered

What percentage of Solana's transaction fees come from trading activity?

Trading dominates Solana's economic activity, with 60% of all base and priority transaction fees coming from transactions that include a DEX swap on spot markets. When perpetual trading is added to the calculation, this percentage increases further. This demonstrates that trading has become the primary use case driving network revenue, far surpassing other types of on-chain activity in economic importance.

What are proprietary market makers and why do they matter?

Proprietary market makers (prop MMs) are a newer DEX design where professional market makers provide their own liquidity directly to DEX aggregators rather than operating separate front-ends. They use price oracles to actively manage their liquidity and adjust prices without needing trades to pass through their pools. This allows them to avoid toxic arbitrage flow more effectively than traditional AMMs, resulting in better profitability for liquidity providers. Prop MMs now handle 60% of all spot trading volume on Solana, fundamentally changing how decentralized trading works on the network.

How much network activity do market makers generate on Solana?

Market makers generate an enormous amount of activity on Solana, with oracle updates accounting for 20% of all transactions on the network. This translates to approximately 175 transactions per second dedicated to market makers competing to offer users the best prices. However, these transactions are highly optimized and represent only about 2% of total transaction fees and tips, demonstrating efficient use of block space.

What is the "everything chain" thesis for Solana?

The everything chain thesis positions Solana as becoming the central hub for all global financial activity - handling every type of asset across every market in any financial instrument format including spot, perpetuals, and options. Currently, sophisticated market-making systems operate on 30-50 crypto-native pairs, but the vision imagines scaling to thousands of assets including tokenized equities and traditional financial instruments. If achieved, this would create a direct link between global economic output and on-chain activity.

How has Solana's revenue performance changed in recent years?

Solana's 2024-2025 revenue performance has been dramatically better than previous years, described as "almost hilariously good" in context. The network has become the blockchain with the most revenue-generating applications, driven primarily by trading activity and the emergence of proprietary market makers. The 2025 data confirmed that 2024 wasn't a one-time event but the beginning of a sustainable trend in network economic activity.

Why does this matter for SOL token holders?

If Solana succeeds in becoming the hub for global financial activity, the SOL token becomes extremely compelling as an asset. Transaction fees would grow proportionally with global economic output, generating yield through fee burns and staking reward distributions. This creates a fundamentally different value proposition than most blockchain tokens offer, directly tying token value to the growth of global financial markets rather than just crypto-specific activity.