Solana DEX Traders Continue to Decline Amid Rise in Meme Coin Scams

By Akash Girimath

Retail traders on Solana-based decentralized exchanges are shifting their attention elsewhere in the cryptoeconomy, with the month of August extending a year-long decline as concerns linger over scams related to meme coins.

The daily DEX trader count has plummeted from a peak of 4.8 million at the start of the year to just 900,000 in August, according to one Dune Analytics dashboard. Daily DEX transactions have also nearly halved, from a July peak of 45 million to 28.8 million.

One expert Decrypt spoke to has linked the dip to predatory meme coin rug pulls and Ethereum’s growing dominance.

“The collapse of extractive meme coins, which drove speculative retail trading, is a primary factor in the sharp drop in daily DEX traders," Ryan Lee, chief analyst at Bitget, said.

Solana's reliance on “volatile meme coin activity may undermine sustainable growth,” he said.

Decrypt has reached out to several Solana-based DEXs. A representative from the Solana Foundation did not immediately respond to a request for comment.

In August, hackers hijacked the Instagram accounts of stars including Adele, Future, Tyla, and even Michael Jackson’s estate to promote FREEBANDZ, a fake Solana token that plummeted in value by 98%.

Similarly, the fake CR7 token, falsely tied to Cristiano Ronaldo, rocketed to a $143 million market cap in minutes before insiders drained liquidity.

The most recent was a fake crypto imitating Kanye West’s official YZY meme coin. West later clarified on Wednesday that his Instagram account had been hacked, resulting in an 81% drop in value for his official token.

Solana’s meme coin frenzy, which kicked off late last year, has given way to quick pumps and dump schemes designed to extract value from unwitting investors.

With retail participation waning and whale dominance rising, Solana's "retail chain" label is weakening, “potentially hindering long-term growth unless it diversifies beyond meme coins to compete with Ethereum's broader DeFi ecosystem,” Lee said.

Although Solana’s share of DEX volume fell sharply from 76% in January to just 8% by June, “primarily driven by rotation into BNB DEXs,” it has since rebounded to roughly 27%, Max Shannon, senior associate at Bitwise Europe, told Decrypt.

“The network still has the best capital efficiency at scale, supported by a well-aligned roadmap and clear vision to further improve throughput while reducing costs.”

Those fundamentals position Solana to “remain increasingly competitive” against its primary rivals over the long run, he said. “Overall, I remain confident in the long-term health and success of the Solana network and the asset.

Solana is up 1.8% on the day to $215 and up more than 15% on the week.

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