Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • TRADING
  • HACKING
  • SLOT
  • CASINO
  • SUBMIT
Crypto Flexs
  • DIRECTORY
  • CRYPTO
    • ETHEREUM
    • BITCOIN
    • ALTCOIN
  • BLOCKCHAIN
  • EXCHANGE
  • TRADING
  • HACKING
  • SLOT
  • CASINO
  • SUBMIT
Crypto Flexs
Home»ALTCOIN NEWS»Solana’s declining revenues risk exacerbating its centralization problem.
ALTCOIN NEWS

Solana’s declining revenues risk exacerbating its centralization problem.

By Crypto FlexsSeptember 6, 20243 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Solana’s declining revenues risk exacerbating its centralization problem.
Share
Facebook Twitter LinkedIn Pinterest Email
  • Solana’s sales hit their lowest point in months.
  • Small validators have a hard time competing.
  • Solana has already been criticized for its centralization.

Solana often boasts low fees and scalability. Now, the risk of centralization may be greater than ever because of the validators who are a core part of the network. They are responsible for keeping the network running and maintaining a decentralized state.

As Solana’s fees drop to monthly lows, many validators are struggling to maintain the sophisticated and expensive equipment needed to run the Solana network.

Solana’s low fees risk centralizing the network.

Solana’s blockchain is under significant pressure from its validator ecosystem. Small validators who are essential to maintaining a decentralized network are struggling to survive as their revenue streams dwindle.

Solana validators earn revenue proportional to the amount of SOL they stake. At the same time, validator fees are largely fixed, as pointed out in a recent Helius report. These costs include the sophisticated equipment needed to run the network.

This means that smaller validators could go out of business due to the decrease in revenue. If the revenue is not enough to cover the expenses, they will have to close. In particular, about 72% of validators rely on special grants from the Solana Foundation, which aims to promote decentralization. However, this revenue source is also decreasing.

Solana Foundation Cuts Subsidies for Small Validators

The Solana Foundation’s Delegation Program (SFDP), a major grant that supports small validators, has seen a significant cut. The SFDP currently delegates 51 million SOL across the network, which is 13% of Solana’s total staked tokens, but this figure was previously 100 million.

In addition, the Solana Foundation has lowered the maximum fee that a validator can charge from 7% to 5% and introduced a 10% cap on Jito Maximal Extractable Value (MEV) fees. These fees are controversial but have helped support smaller validators. However, according to Dune, this amounts to only 5% of validator revenue.

Without the current subsidy, many validators would struggle to break even. Approximately 73% of validators who participated in the SFDP program raised less than 10,000 SOL, and 51% raised less than 1,000 SOL.

Helios estimates that 897 validators, or 57% of SFDP participants, will fail, which would be a huge blow to Solana’s validator count and decentralization.

Why Solana’s Revenues Are Declining

Solana’s recent revenue decline was driven primarily by a significant decline in network activity related to Mimecoin transactions. Last year, Solana became a hub for Mimecoin thanks to its low fees and easy-to-use Pump.fun platform.

Solana total network fees and SOL token market cap.
Source: Token Terminal

As the Mimecoin market cooled, Solana’s total trading volume took a big hit. On September 5, Solana’s network fees dropped to 571K, the lowest since March 2024, showing how much Solana relies on Mimecoin activity.

On the other side

  • Pump.fun is an easy way to launch Mimecoin. However, due to high fees and dismal success rate for Mimecoin, Object of criticism.
  • Alternatives like Tron sun pump It is eating into Pump.fun’s market share, which is affecting Solana’s trading volume.

Why this matters

Solana’s decentralization will become increasingly risky as smaller validators are pushed out due to diminishing returns.

Learn more about Solana validator earnings:
Solana validators confirm record-breaking tips as secret fees plague network users

Learn more about the criticism against crypto-friendly banks:
Another Crypto-Friendly Bank Accused of AML Violations

Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

Defi Surges, BTC Swings & Tradfi faces freezing: Daily encryption failure

August 28, 2025

Keepsolid launches KS COIN: Loyalty encryption through actual utility token benefits

August 14, 2025

XRP struggles for $ 3: Do Whale Offroads attract it lower?

August 7, 2025
Add A Comment

Comments are closed.

Recent Posts

InFocus Launches Digital Ventures Strategy With Mythos Group To Push Into Blockchain, AI And Bitcoin

September 1, 2025

WorldShards Announces Partnership With ByBit And TGE Date

September 1, 2025

EcoSync & CarbonCore Launch Full Stages Refi Infrastructure Linking Carbon Credits With Web3

September 1, 2025

NFT sales in August increased 2.78% in July 2025

September 1, 2025

Bitcoin Price Posts for 5 consecutive August losses: Will Michael Saylor react?

August 31, 2025

Metaplanet’s bitcoin strategy is having trouble with stock plummet in the crisis of financing.

August 31, 2025

Next chapter of ecosystem support program

August 31, 2025

Ether Lee (ETH) tests major support for $ 4,453 after the highest rejection.

August 31, 2025

BNB price forecast: Target $ 890- $ 900 in September 2025.

August 31, 2025

After BTS Star Jungkook has 39 billion hacking, South Korea will crack down on encryption fraud.

August 30, 2025

FY Energy Offers Industry-leading Cloud Computing Systems, Offering Opportunities For Daily Passive Income Of $7,580 Through Mining.

August 30, 2025

Crypto Flexs is a Professional Cryptocurrency News Platform. Here we will provide you only interesting content, which you will like very much. We’re dedicated to providing you the best of Cryptocurrency. We hope you enjoy our Cryptocurrency News as much as we enjoy offering them to you.

Contact Us : Partner(@)Cryptoflexs.com

Top Insights

InFocus Launches Digital Ventures Strategy With Mythos Group To Push Into Blockchain, AI And Bitcoin

September 1, 2025

WorldShards Announces Partnership With ByBit And TGE Date

September 1, 2025

EcoSync & CarbonCore Launch Full Stages Refi Infrastructure Linking Carbon Credits With Web3

September 1, 2025
Most Popular

Worldcoin announces circulating supply update and sale to trading companies.

April 24, 2024

Halving highlights why Bitcoin needs to be upgraded

April 15, 2024

Over $5 Billion in “Missing FTX Funds” Reportedly Found

December 3, 2023
  • Home
  • About Us
  • Contact Us
  • Disclaimer
  • Privacy Policy
  • Terms and Conditions
© 2025 Crypto Flexs

Type above and press Enter to search. Press Esc to cancel.