Author: Hu Tao, ChainCatcher
In the cyclical patterns of the cryptocurrency market, Solana once reclaimed its peak through the narrative of being an "Ethereum killer" and its exceptional performance. However, entering 2026, this once fully powered "high-performance computer" is facing unprecedented downward pressure, first evident in its price.
Over the past year, SOL experienced the largest drawdown of 73.5% from its peak among all major cryptocurrencies. In the recent one-month market correction, SOL’s price performance has also been notably weak, significantly underperforming other major cryptocurrencies such as BTC and ETH.
In addition, Solana Core’s vision of an “internet capital market” has been severely impacted by internal and external challenges, forcing the Solana Foundation’s senior team to frequently speak out recently to generate positive momentum for their ecosystem.
Solana's core narrative faces setbacks
Over the past few years, Solana has been trying to tell a story much bigger than just a "high-performance public chain."
According to the Solana Foundation, Solana's endgame has evolved into the "Internet Capital Markets"—a global trading network that brings stocks, commodities, futures, perpetual contracts, and all real-world assets on-chain.
Opening the official Solana website today, the most prominent headline still reads: "The capital market for every asset on Earth."
It means Solana is not just challenging Ethereum, but aims to replace traditional exchanges, brokerages, and clearing systems, becoming the on-chain Nasdaq. Its high speed, low fees, high throughput, relatively mature user experience, and strong backing from Wall Street capital have made Solana once regarded as the blockchain most likely to achieve this goal.
But the issue is that when the "internet capital market" truly began to take shape, the market found that Solana may not be at the core.
Hyperliquid's unexpected impact
One of the biggest structural shifts in the crypto industry over the past year has been the migration of perpetual futures markets from traditional CEXs to on-chain platforms.
The biggest beneficiary of this trend is not Solana, nor Ethereum, Sui, or other networks, but Hyperliquid.
Initially, Hyperliquid was merely an on-chain perpetuals trading platform, but as its Layer 1 strategy progressed, it has evolved into a comprehensive financial infrastructure network. In contrast to Solana’s broad and abstract vision of a “capital market,” Hyperliquid has chosen a more focused, trading-driven path.
For a long time, although the Solana ecosystem has hosted numerous DeFi projects, its core liquidity has consistently favored spot trading, meme coins, and on-chain speculation. Infrastructure capable of supporting institutional-grade trading depth, risk management, and high-frequency trading needs has remained underdeveloped.
More importantly, Hyperliquid has gradually proven something that many previously overlooked: the "internet capital market" does not necessarily require a generalized ecosystem.
For high-frequency financial trading, performance, matching, liquidity, and trading experience are far more important than "on-chain application richness." This means a vertical Layer1 specifically designed for financial trading may be better suited than a general-purpose blockchain like Solana to serve as the core of on-chain capital markets.
This is why more capital, traders, and attention are beginning to converge on Hyperliquid.
After the Drift incident, Solana was forced to adjust its perpetual futures market strategy.
If HyperLiquid externally squeezed Solana’s strategic space in the capital markets, then the Drift Protocol attack opened a massive breach from within.
In early April this year, the Solana DeFi protocol Drift suffered a governance and oracle attack, resulting in losses exceeding $200 million.
As one of the most important perpetuals protocols on Solana, Drift has played a central role in providing liquidity for Solana DeFi. Following the hack, the protocol’s functionality was immediately paralyzed, affecting a large volume of assets, Vaults, and associated protocols within the Solana ecosystem, rapidly eroding market confidence.
Perpetual contracts are a critical battleground in the DeFi space; facing the market vacuum left by Drift and Solana’s strategic gap in on-chain derivatives, Solana’s official team must actively promote a new alternative product to capture users and market share on the front line of its “internet capital markets” strategy.
At this point, Solana’s official team had a range of products to choose from: Pacifica, Phoenix, Jupiter, GMTrade, Bullet, Blink, and others. However, Solana’s founder Anatoly Yakovenko firmly chose Phoenix.
Over the past five days, Toly has posted or retweeted at least twenty tweets related to Phoenix, either sharing others' experiences with Phoenix's beta, directly recommending its use, or expressing his views on Phoenix.
Regarding this "preference," Toly has explained multiple times that Pacifica does not execute trades on the Solana chain; its compatibility with Solana is just as good as HyperLiquid's, and since Jup is already well-established, he is more focused on early-stage teams building from zero to one. Meanwhile, Phoenix is decentralized and can be atomically composed with all other applications on Solana.
Under Toly's influence, Phoenix's popularity has ranked in the top three of RootData's trending projects list for multiple consecutive days, reaching its all-time high popularity index.
However, in terms of trading volume, Phoenix still lags far behind other established perpetual futures platforms. According to DeFiLlama data, Phoenix had long maintained daily trading volumes below $4 million, but recently, fueled by market momentum, its daily trading volume surpassed $80 million for the first time. Nevertheless, it still ranks outside the top 20 among all perpetual futures platforms, remaining more than 20 times behind the fifth-place platform, which has a minimum of $1.6 billion in daily volume.
Solana's public relations campaign and internal divisions
Faced with Hyperliquid's strong rise and the trauma to their own ecosystem, Solana supporters have chosen a path that seems to "use the enemy's weapon against them"—leveraging decentralization as a weapon to launch舆论 attacks against Hyperliquid.
A member of the Solana Foundation, @harkl_, tweeted that Hyperliquid markets itself as a decentralized exchange, but in reality has 24 validator nodes, closed-source node code, a single bridge holding billions of dollars in assets, and a history of forced settlements during market volatility.
“Can you participate in any part of the protocol stack using your own resources without approval from a trusted third party? If not, then it’s not permissionless,” Toly further stated. “No matter what you do, you cannot run the Hyperliquid sequencer.”
This argument has sparked intense debate within the crypto community. Supporters argue that Toly has identified Hyperliquid’s core weakness—if there are fewer than 30 validation nodes, the node code is not open source, and the bridge is highly centralized, then what fundamentally distinguishes the so-called “on-chain capital market” from the custodial model of a CEX?
Critics point out that Solana’s own number of validators has sharply declined from 2,560 to approximately 756, with the Nakamoto coefficient dropping from 31 to 20, and the top twenty validators controlling over one-third of the staked stake—making discussions of “decentralization” in this context somewhat akin to the pot calling the kettle black.
An even thornier issue stems from within the Solana ecosystem: the consistent "favoritism" shown by many top Solana Foundation figures has upset numerous other protocol developers.
“They will promote what they believe is most beneficial to themselves; pushing others away just because a team meets a certain standard turns friends into enemies,” said kdotcrypto, co-founder of Bulk.
Constance, founder of Pacifica, offered a more restrained but equally pointed comment: “In 2025, we chose Solana without accepting any funding from the foundation or raising capital from investors—we simply wanted to focus on building a great product and let the market decide.” Behind the phrase “let the market decide” lies a subtle protest against the Solana Foundation’s role as both referee and player.
The harshest truth about the crypto market is that users don’t care about grand narratives—they care about depth, liquidity, and security. Hyperliquid’s rise is not just a technological victory, but a dimensional strike against the “general-purpose blockchain” narrative—it proves that the core of building a capital market isn’t a sprawling ecosystem, but an极致的撮合引擎.
Today, Solana is caught in a race to outperform competitors on decentralization metrics, while its flagship Phoenix platform still faces a 20x trading volume gap compared to mainstream derivatives platforms.
In the race for the ultimate fate of the internet capital market, if Solana fails to regain its dominance in the derivatives space by the second half of 2026, it may remain a great Meme paradise, but it will grow increasingly distant from the dream of “hosting global assets.”