Institutional Bet Boosts Solana's TVL to $12.1B – But Can It Last?

Solana's decentralized finance (DeFi) protocols have driven the total value locked (TVL) on the network to an all-time high of $12.1 billion in 2025. This surge reflects strong demand for Solana-based yield strategies and liquidity solutions, as well as growing interest from institutional investors and large whale wallets. The TVL has increased by over 15% in the past month alone, with a notable 6% rise in the last 24 hours. Solana's TVL is largely supported by a $12.5 billion stablecoin base, offering a strong foundation for further growth.

One of the key factors behind Solana's recent TVL growth is the establishment of a $1.65 billion Solana-focused digital asset treasury by Forward Industries. This initiative has been supported by major institutional investors such as Galaxy Digital, Jump Crypto, and Multicoin Capital. The move signals long-term confidence in Solana's ecosystem, particularly in its ability to attract liquidity and foster DeFi innovation. Whale activity has also played a role in boosting Solana's TVL, as evidenced by the transfer of $80.7 million worth of SOL from Binance to the Solana-based yield platform Kamino.

Despite Solana's strong TVL performance, its ability to sustain momentum remains in question. While the network has attracted $118.4 billion in decentralized exchange (DEX) volume over the past 30 days and has a user base of around 2.6 million daily active users, there are concerns about the sustainability of its growth model. For instance, Solana distributed $28.3 million in token incentives in a single day, compared to just $1.49 million in chain fees, raising concerns about the long-term viability of such strategies. Additionally, DEX volume has seen an 8.3% weekly decline, indicating potential slowdowns in user activity.

Ethereum, on the other hand, has demonstrated more consistent growth in its TVL, which now stands at $92 billion. This growth has been fueled by a combination of institutional inflows, rising ETH prices, and robust performance on Layer-2 networks. Protocols like Lido DAO, Aave, and EigenLayer have each attracted over $30 billion in deposits, while EigenLayer has offered stablecoin yields as high as 25%. Ethereum's TVL has decisively broken above previous highs, outpacing Solana's TVL, which has remained relatively flat around early 2025 levels.

The contrast between the two networks highlights a key challenge for Solana: turning short-term activity into lasting growth. While Solana benefits from fast transaction speeds, low costs, and a growing stablecoin base, it will need to maintain user engagement and reduce reliance on short-term incentives to close the gap with Ethereum. Meanwhile, Ethereum’s scaling roadmap and institutional adoption provide a strong foundation for continued growth in the DeFi space.