SOL traders have lost track of why Solana’s activity is on the decline.

Main Receptors:

SOL is struggling to hold $80 with a 75% drop in futures open interest as traders head for the exits instead of opening new bets.

Solana remains heavily dependent on retail and memecoin activity, with Ethereum taking the lead in high-value decentralized finance.

Solana native token SOL (SOL) has hit a wall, failing to bounce back above $89 over the past two weeks. This slow price action follows a rejection at $145 in mid-January and a sharp decline to $67.60 during the February 6 crash. The need for bullish leverage is basically analyzed as traders lean towards more pain.

Bettors with SOL are paying a 20% annual rate just to keep their short positions open, a rare and aggressive move. Funding rates have been negative for more than a week, indicating that bears have strong confidence. In contrast, ETH's annual funding rate stood at 1 percent on Wednesday. While this is below the typical 6% neutral mark, it is nowhere near the levels of disorder seen in SOL.

Frustration is mounting as SOL has underperformed the rest of the crypto market by 11% over the past 30 days.

Although SOL remains among the top seven cryptocurrencies by market value, its 67% slide from its September 2025 high of $253 has left its mark on both onchain activity and derivatives. In fact, SOL futures open interest is down 75% from a peak of $13.5 billion seen five months ago.

Solana feared the “spin of death.”

This price drop is affecting decentralized applications (DApps) built on Solana. Revenues are across the board from savings and decentralized exchanges to launchpads and lending platforms. Investors are beginning to worry about the “death spiral,” which reduces incentives for falling prices, making it difficult for people to hold SOL for long.

Weekly DApp revenue on Solana dropped to $22.8 million, the lowest since October 2024. In particular, the memecoin launch pump generated $9.1 million in revenue in these seven days, which is 40% of the network's total revenue. In comparison, weekly DApps revenue on Ethereum totaled $16 million, up 2 percent from last month.

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Unlike Solana, the top-grossing DApps on Ethereum are Sky, Flashbots and Ave – key infrastructure players in decentralized finance. Basically, Solana is on board with retail and is very dependent on the memecoin sector, Ethereum has confirmed its leadership in Total Value Locked (TVL) and uses cases that require high decentralization.

This weak institutional interest is reflected in SOL exchange traded funds (ETFs). Solana's high trading volume and secondary TVL were not enough to convince traditional investors to buy SOL ETFs offered by Bitwise, Fidelity, Grayscale, 21Shares, CoinShares and REX-Osprey.

While significant, Solana's $2.1 billion in ETF assets under management is still 86% behind Ethereum's $15.8 billion. Many investors have lost faith that demand for Solana DApps will increase anytime soon, which may be a side effect of the intense buzz around memecoins and launchpads.

SOL needs a push from sectors like artificial intelligence infrastructure and prediction markets to regain its mass momentum. These places show promise, but the competition is tough.

Currently weak SOL derivatives and Solana onchain metrics are a warning sign. Any further disappointment could trigger another bearish decline, putting the already shaky $78 support level at serious risk.