Original author: @calilyliu

Original compilation: zhouzhou, BlockBeats

Editor's Note: This article reveals the bias in the a16z report, overlooking Solana's outstanding performance in the Money Laundering, Non-fungible Token, and Decentralized Finance markets. Despite Solana's leading position in Non-fungible Token Address and volume in the past year, the report fails to mention the significant innovations of DePIN, such as helium and Hivemapper. These groundbreaking projects demonstrate real-world applications of the Decentralization network, especially the thriving development within the Solana ecosystem, which is highly anticipated for the future.

The following is the original content (slightly edited for better understanding):

I read the "encryption industry status" report by a16z and gained a lot! Although I mainly follow areas outside of EVM, I always cherish the opportunity to understand other innovations in the self-custody field. However, I noticed some implicit EVM bias in the report. Here are some of my observations:

Related reading: "a16z Annual encryption Report"

The author sets the world framework as a dichotomy between EVM and non-EVM, creating a binary opposition that treats ecosystems and developers who do not choose to develop within the EVM as 'others'. For example, the visualization of active addresses is misleading. Solana has reached 100 million monthly active addresses, surpassing the base's 22 million, yet the chart almost equates the two. A more accurate approach would be to use a single bar chart with different colors to distinguish between EVM and non-EVM bars (if necessary). In addition, the slide claims that 'Base and Solana' have the highest number of monthly active addresses, but attentive readers will notice that NEAR Protocol has 31 million active addresses, surpassing the base. Therefore, the title should be changed to '...Solana and NEAR are the most active'.

Now let's discuss the selection of indicators. In our industry, we usually use active Address and Total Value Locked (TVL) as the standard benchmark for the ecosystem. However, I suggest measuring the activity, demand, and overall health of the ecosystem in a more meaningful way: Money Laundering. Money Laundering directly reflects the participation of users in valuable economic activities, their willingness to make payments, and the ability of validators to profit.

With the introduction of the fee market, we can now differentiate the economic value of different types of activities within the Solana ecosystem and apply this approach to other ecosystems.

Solana has made significant progress in Money Laundering. Prior to December 2023, Solana's monthly Money Laundering market share never exceeded 1.5%. Since April 2024, this proportion has consistently remained above 10% and reached its highest point of 25% in July. When we consider MEV fees to measure 'Real Economic Value' (REV), Solana is narrowing the gap! The chart from blockworksres highlights the narrowing REV gap between Solana and Ethereum.

This is another perspective centered around the EVM, involving the gaming industry. By using mgas/s as a metric to evaluate game infrastructure, it excludes Solana and other non-EVM networks, resulting in meaningless comparisons and only allowing us to see a partial picture of the blockchain gaming ecosystem.

Another example is related to Decentralized Finance, where TVL is not sufficient as a metric for comparing Decentralized Finance activities, especially in key categories such as DEX, Derivatives, and bridge, where volume has a stronger correlation. Although the report emphasizes overall DEX volume, it only provides protocol segmentation based on TVL, overlooking key aspects of Liquidity activities.

TVL tends to lean towards ecosystems with a large amount of asset reserves but limited Liquidity, such as the Ethereum network. Although Solana's TVL only accounts for 10% of Ethereum's, its monthly DEX volume in 2024 fluctuates between 50% and occasionally exceeds Ethereum's Fluctuation. In order to accurately reflect on-chain economic activity, it is necessary to follow the economic value of transactions, not just the holding value. In this context, ecosystems with higher capital efficiency and superior on-chain performance stand out.

In comparable metrics across ecosystems, the report still mainly follows Ethereum and EVM L2. It sees the implementation of EIP-4844 as an important milestone in dropping industry costs. However, it is worth noting that since its launch in March 2020, Solana's Transaction Cost has also remained at a low level. Furthermore, in terms of transaction affordability, Solana's median fee has always been lower and more stable than Base.

Despite ranking first in Non-fungible Token Address, second in volume, and fourth in unique collectibles according to the data from nftpulseorg over the past year, Solana was once again excluded from this Non-fungible Token comparison.

The slide mentioned that low Transaction Cost drives new consumer behavior, which can be well illustrated by the example of drip haus. Since March 2023, the platform has minted a total of 182 million Non-fungible Tokens at a total cost of only 1600 SOL (calculated at a price of 150 US dollars per SOL, each Non-fungible Token only costs 0.001 US dollars), as pointed out by ledger top.

The absence of DEP is very obvious, helium is completely changing the cellular network, currently has over 1 million active hotspots in 182 countries. Hivemapper uses the Decentralization network to map the world, recording over 7.5 million kilometers of street data in more than 50 countries. rendernetwork provides Decentralization GPU rendering services, providing critical computing power for industries such as gaming and artificial intelligence. This is an upgraded version of SETI@home, demonstrating practical application value.

More importantly, these innovations mostly occur in Solana rather than the EVM ecosystem, is this why DePIN is not mentioned in the report at all?

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