"a16z is biased against EVM", what does the chairman of the Solana Foundation think of a16z's crypto industry report?

Original author: @calilyliu
Original translation: zhouzhou, BlockBeats

Editor's note:This article reveals the EVM bias in the a16z report, ignoring Solana's outstanding performance in transaction fees, NFTs, and the DeFi market. Although Solana has ranked among the top in NFT addresses and transaction volume in the past year, the report did not mention DePIN's major innovations such as helium and Hivemapper. These breakthrough projects demonstrate the real-world applications of decentralized networks, especially the thriving development in the Solana ecosystem, which makes people look forward to the future.

The following is the original content (the original content has been reorganized for easier reading and understanding):

I read a16z's "State of the Crypto Industry" report and gained a lot! Although I mainly focus on areas other than EVM, I always cherish the opportunity to learn about other innovations in the field of self-custody. However, I noticed a certain implicit EVM bias in the report. Here are some of my observations:

Related reading: "a16z Annual Crypto Report"

The author frames the world as an opposition between EVM and non-EVM, forming a binary opposition that regards 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 100 million monthly active addresses, exceeding base's 22 million, but the chart treats the two almost the same. It would be more accurate to use a single bar chart and distinguish the EVM and non-EVM bars with different colors (if necessary). Additionally, the slides claim that “Base and Solana” have the highest monthly active addresses, but careful readers will notice that NEARProtocol has 31 million active addresses, surpassing Base. Therefore, the title should be changed to “…Solana and Near are the most active.”

Now for a discussion on metric choice, our industry typically uses active addresses and total value locked (TVL) as standard benchmarks for ecosystems. However, I would like to propose a more meaningful way to measure the activity, demand, and overall health of the ecosystem: transaction fees. Transaction fees are a direct reflection of users’ participation in valuable economic activity, their willingness to pay for execution, and the ability of validators to be profitable.

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

Solana has made significant progress on the transaction fee front. Prior to December 2023, Solana’s monthly transaction fee market share never exceeded 1.5%. Since April 2024, it has consistently remained above 10%, peaking at 25% in July. When we factor in MEV tips to measure “real economic value” (REV), Solana is closing the gap! This chart from blockworksres highlights the closing of the REV gap between Solana and Ethereum.

Here’s another EVM-centric perspective, involving the gaming space. Using mgas/s as a metric for evaluating gaming infrastructure excludes Solana and other non-EVM networks, leading to meaningless comparisons and giving us only a partial picture of the blockchain gaming ecosystem.

Another example relates to DeFi, where TVL is an inadequate metric for comparing DeFi activity, especially in key categories such as DEX, derivatives, and bridges, where volume is more relevant. While the report highlights overall DEX volume, it only provides a protocol breakdown based on TVL, ignoring the key aspect of liquidity activity.

TVL tends to favor ecosystems with large reserves but limited liquidity, such as Ethereum. While Solana’s TVL is only 10% of Ethereum’s, its monthly DEX volume in 2024 fluctuates between 50% and occasionally exceeding Ethereum. To accurately reflect on-chain economic activity, it is important to focus on the economic value of transactions, not just the value held. Against this backdrop, ecosystems with greater capital efficiency and superior on-chain performance stand out.

Among the comparable metrics across ecosystems, the report still focuses primarily on Ethereum and EVM L2. It sees the implementation of EIP-4844 as an important milestone in the industry's fee reduction. However, it is worth noting that Solana's transaction costs have also remained low since its launch in March 2020. In addition, in terms of transaction affordability, Solana's median fee has always been lower and more stable than Base.

Solana was again excluded from this NFT comparison despite ranking #1 in NFT addresses, #2 in transaction volume, and #4 in unique collectibles over the past year according to nftpulseorg.

The slides mention low transaction costs driving new consumer behaviors, which is best illustrated by the example of drip haus. Since March 2023, the platform has minted 182 million NFTs at a total cost of just 1,600 SOL ($0.001 per NFT at a SOL price of $150), as noted by ledger top.

The absence of DePIN is very obvious. Helium is revolutionizing cellular networks and currently has more than 1 million active hotspots in 182 countries. Hivemapper uses decentralized networks for global mapping and has recorded more than 7.5 million kilometers of street data in more than 50 countries. Rendernetwork provides decentralized GPU rendering services, providing key computing power for industries such as games and artificial intelligence. This is an upgraded version of SETI@home, showing practical application value.

More importantly, most of these innovations occurred in Solana rather than the EVM ecosystem. Is this why DePIN is not mentioned at all in the report?

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