According to The DeFi Report, over the past month, only 1.26% of Solana’s (SOL) wallet addresses have generated 95% of its total fees. 

This concentration has raised significant concerns about the blockchain’s fee model and its implications for decentralization. 

Solana’s Fee Structure Faces Criticism 

Data from DefiLlama, shows that Solana generated 89.73 million in fees in February. As of March 7, it had generated 8.21 million.

In comparison, Ethereum (ETH) generated 46.28 million in fees in February, with 7.49 million as of March 7.  While these numbers suggest Solana is ahead, Michael Nadeau, the founder of The DeFi Report, claims this comparison may be misleading. 

Although Nadeau acknowledges Solana’s impressive growth, he cautions that it might be less organic than it seems.

“But if you look under the hood, it looks like a house of cards,” he wrote.

According to Nadeau, over the past 30 days, 17.31% of addresses have contributed to 95% of the total fees generated on Ethereum. For Solana, the figure is strikingly small, only 1.26%. 

Nadeau added that Wintermute, a prominent market-making firm, is the primary driver behind this fee generation. The rest of the fee is attributed to bots.

He claimed that these wallets drive the network’s activity through practices such as sandwich attacks and pumping meme coins. This often comes at the expense of retail investors. 

For context, a sandwich attack is a front-running strategy in which an attacker exploits large trades. The attacker buys the asset before the large trade, anticipating a price increase, and sells afterward, profiting from the price movement while negatively impacting the original trader.

Nadeau cautioned that the reliance on a small subset of users for fee generation creates vulnerabilities. If retail traders become aware of the extent of bot-driven manipulation, they may withdraw from the ecosystem. This, in turn, could significantly impact Solana’s revenue projections.

“Nothing against Solana. Massive comeback story. But my sense tells me another period of “chewing glass” is yet to come,” he concluded.

Solana’s speed and cost efficiency have made it a favorite among developers and traders. However, this concentration of fees has raised concerns among market analysts.

“When 95% of fees come from 1.26% of users, it’s less “decentralized finance” and more “exclusive finance,” Superchargd co-founder wrote on X.

Another user also warned that Solana may not thrive well as the industry matures and free market forces fully take effect.

“Solana doesn’t have a future; it’s a Ponzi scheme designed for grifting,” he said.

Meanwhile, some questioned SOL’s inclusion in President Trump’s US crypto strategic reserve. 

“Solana is a complete house of cards built on wash trading bots and centralized control,” a user remarked.

He also emphasized that validators profiting from failed transactions and the rise of Solana meme coins have harmed the space.

The criticism comes just after financial giant Franklin Templeton predicted in a report that Solana’s DeFi ecosystem could rival—and even surpass—Ethereum’s market valuation. The firm highlighted Solana’s scalability, low fees, and surging user activity as key factors driving its potential.

Amid the mounting criticism, Solana faces a pivotal moment. While its technological advancements and cost-efficiency have earned it a loyal following, its centralized fee-generation model and reliance on market manipulation tactics could pose significant risks to its future. How Solana adapts to these concerns will determine whether it can sustain its growth or struggle to maintain relevance.