How Solana plans to take on the DeFi sector with Firedancer

The new validator client for Solana aims to improve the state of Solana in terms of DeFi.
SOL price and DEX volumes surged, however TVL continued to decline.

Over the past few years, Solana[SOL] has experienced its fair share of ups and downs. The network has faced multiple downtimes, and more recently SEC’s classification of SOL as security also posed setbacks.

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A new client to smooth things over?

However, a new validator client could soon improve the state of Solana going forward. According to Messari’s data, Firedancer, an independent validator client, built by Jump, could make things better, at least on the DeFi front.

The data suggests that Firedancer can enhance DeFi maturity by reducing latency times, thereby bringing decentralized exchanges closer to parity with centralized exchanges.

Source: Messari

By reducing latency times, Firedancer can enable faster transaction processing, which can improve the overall user experience and attract more participants to the network. This increased efficiency can potentially enhance the scalability and usability of decentralized applications built on Solana.

Furthermore, the closer proximity of decentralized exchanges to centralized exchange parity brings several advantages. It allows for seamless trading experiences for users, as they can enjoy similar levels of speed and liquidity as offered by centralized exchanges. This can boost liquidity on decentralized exchanges and attract more traders to participate, thereby expanding the ecosystem and fostering greater adoption of Solana-based DeFi protocols.

State of DeFi

However, at press time, the TVL of Solana had declined massively over the last few months. According to Artemis’ data, TVL fell from $295 million to $266 million since April. This could be attributed partially to the low DEX volumes exhibited on the Solana network.

Even though DEX volumes were low for the majority of this year, an uptick in this metric was observed over the last few weeks. This uptick caused a slight surge in Solana’s TVL as well. Only time will tell whether Solana can manage to keep up these numbers and maintain sustained growth in the future.

Source: Artemis

Realistic or not, here’s SOL’s market cap in BTC terms

Coming to the stakers, it was observed that they remained positive toward Solana and continued to support the network. According to Staking Rewards’ data, the Solana network was the second most popular network amongst stakers after Ethereum.

At press time, it appeared that along with stakers, investors also continued to show their support for SOL as its price witnessed growth over the last few days. Coupled with a spike in price, there was also a surge in volume observed for Solana.