2022 has not been a good start for cryptocurrencies and to date, the total market capitalization has dropped by 21% to $1.77 trillion. Solana’s (SOL<\/a>) correction has been even more brutal, presenting a 48.5% correction year-to-date.<\/p>\n Solana leads the staking charts with $35 billion<\/a> in value locked, which is equivalent to 74% of the SOL tokens in circulation. Multiple reasons can be identified for the underperformance, including four network outages<\/a> in late 2021 and early 2022.<\/p>\n The latest incident on Jan. 7 was attributed to a distributed denial-of-service (DDoS) attack, causing Solana Lab developers to update the code and consequently reject these types of requests.<\/p>\n However, investors are more concerned about the centralization caused by the costs of being a Solana validator. To achieve 400 millisecond block times, the recommended hardware<\/a> includes a 12 core 2.8GHz CPU, 256 GB memory, high-speed 1 TB SSD drives and a low-latency internet connection.<\/p>\n solana is cool for a centralized corporate state-sync machine… I just prefer real crypto and blockchain<\/p>\n \u2014 UltraXBT.eth (@UltraXBT) January 29, 2022<\/a><\/p><\/blockquote>\n Solana’s primary decentralized application metric started to display weakness earlier in November after the network’s total value locked (TVL) began to linger at $15 billion.<\/p>\n The chart above shows how Solana’s decentralized application (DApp) deposits saw a 50% decrease in three months as the indicator reached its lowest level since Sept. 8. As a comparison, Fantom’s TVL currently stands at $9.5 billion after doubling in three months. Another DApp scaling solution competitor, Terra (LUNA<\/a>), saw an 87% TVL hike to $23.2 billion.<\/p>\n On the bright side, on Feb. 21, FTX.US, the American arm of the global crypto derivative and spot exchange FTX, announced a new blockchain gaming unit<\/a>. It is also worth noting that Solana Ventures partnered with FTX and Lightspeed Venture on Nov. 5 to launch a $100 million fund dedicated to the sector<\/a>.<\/p>\n To confirm whether this drop in TVL should be concerning, one should analyze DApp usage metrics. Some DApps are not financially intensive, so the value deposited is irrelevant.<\/p>\n As shown by DappRadar data, on Jan. 28 the number of Solana network addresses interacting with decentralized applications dropped by 18% on average. The only positive change was Solend, an algorithmic lending protocol.<\/p>\n The decreased interest in Solana DApps was also reflected in its futures open interest, which peaked at $2 billion on Nov. 6 and was recently hit with a steep correction.<\/p>\n Even though Solana has been hit the hardest compared to similar smart contract platforms, there is solid network use on non-fungible tokens (NFT) marketplaces, as measured by Magic Eden’s 178,820 active addresses in the last 30 days.<\/p>\n Moreover, Solana Ventures’ bet on the gaming sector could further showcase the network\u2019s processing capacity. For instance, games represent half of the top 10 DApps across every blockchain covered by DappRadar<\/a>. That includes Splinterlands, which has 578,280 active addresses and Alien Worlds which has 544,900. <\/p>\n The above data suggests that Solana is losing ground versus competing chains, but holders are not concerned because 74% of the coins are still locked in staking. As long as Solana Labs’ partnerships and investments continue to show potential, there is little reason to be bearish on SOL.<\/p>\n The views and opinions expressed here are solely those of the <\/em>author<\/em><\/a> and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.<\/em><\/p>\n<\/div>\n![](\"https:\/\/s3.cointelegraph.com\/uploads\/2022-03\/1a2fcbfe-a7fa-4319-81f8-0de9899fa26d.png\")
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dApp use is on the decline<\/h2>\n
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The gaming sector could be a surprise factor<\/h2>\n