Solana enters 2026 facing the question of whether infrastructure upgrades and tokenized financial activity can push the network beyond memecoin’s reputation.

Solana started 2025 at the height of the memecoin craze, with Solana (SOL) hitting a modern all-time high of $293 on January 19. As memecoin volumes declined throughout the year, SOL dropped to around $130 by mid-December.

“Solana needs to shake off the “memecoin” badge. [or] The NFT network is positioning itself as a sedate place for Web2 and Web3 financial companies to come and build the future of finance,” Tomas Fanta, director of cryptocurrency investment firm Heartcore, told Cointelegraph.

Whether Solana can move beyond this reputation will largely depend on the success of its infrastructure upgrades. Next year, Solana is expected to accelerate the rollout of its Firedancer validator client, which will offer consensus changes and runtime improvements aimed at increasing network predictability and resiliency.

Solana’s Firedancer is now available

The development of layer 1 blockchain infrastructure is already progressing. The Firedancer validator client now runs on the mainnet.

Firedancer, developed by Jump Crypto, is a re-implementation of the Solana validator software, designed to improve performance. The client is able to process up to approximately 1 million transactions per second (TPS) under ideal conditions.

The Solana Foundation reported on December 12 that Firedancer has been creating blocks on the mainnet for over 100 days outside of test environments.

Two validators currently employ the full Firedancer client, but a hybrid version known as “Frankendancer” has been much more widely adopted. The data shows that around 165 validators, representing around 26% of the total stack, are currently using Frankendancer alongside the existing Agave client.

Doug Colkitt, co-founder of Fogo, the Layer 1 blockchain on which Frankendancer currently runs, told Cointelegraph that a bigger test will come as more stakes move to pure Firedancer, because stability in a compact part of the network does not guarantee stability at scale.

“In many cases, a client may be stable if you test it as a small percentage of the network, and then some things may not come to light until you scale it to a larger percentage of the network.”

For developers working on latency-sensitive financial products, these performance changes are already making a difference.

“For products like ours where milliseconds count, I expect the Firedancer update will make trading even faster,” said Igor Stadnyk, co-founder and AI leader at True Trading, an AI trading platform powered by Solana.

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Stadnyk said that what is more essential than the results themselves is whether they can be consistently relied upon.

“Firedancer matters for a reason that doesn’t get enough attention: predictability. The throughput and latency improvements are great, but more importantly, Solana gains a fully independent client with a different code base, engineering culture, and failure modes.”

In addition to Firedancer, Solana developers are also preparing for Alpenglowproposed change to the Solana consensus draft. The update would replace Proof-of-history and TowerBFT technology, reducing block finalization time to approximately 150 milliseconds while improving the network’s ability to function even if some validators are unresponsive.

“If successfully implemented, this new consensus mechanism will unlock Solana to higher levels of performance,” Fanta said.

Memecoins don’t have to be an unintended burden on Solana

Memecoins have been one of Solana’s most essential growth engines, driving user activity and cultural relevance over the past few years. This activity helped attract developers and merchants to the network and played a major role in Solana’s decentralized finance resurgence.

At the same time, the dominance of memecoin trading has shaped the way the network is perceived by investors and financial institutions, often tying Solana’s growth to speculative cycles.

“Memecoins are not going away. They are part of Solana’s cultural identity and a liquidity engine that attracts users,” Stadnyk said.

He added that the next phase of growth will likely come from applications that rely less on viral speculation and more on consistent execution, such as onchain perpetual futures and AI-native trading agents.

Memecoin trading has also changed the way liquidity is provided on the Solana platform. Over the past year, there has been a surge in online market making (AMM), where trading firms deploy their own capital and algorithms on-chain rather than relying on permissionless liquidity pools.

“In 2025, prop AMMs have probably changed everything. Solana has always been a very trade-focused network, and prop AMMs have truly revolutionized the market structure there – at least in spot trading.”

Colkitt said the model came with trade-offs, especially when it came to centralization, but argued it emerged as a direct response to demand.

“If the memecoin explosion had not occurred, there would not have been an explosion of activity in Solana,” he said. “Without this transaction volume, the market structure and infrastructure would not have been built.”

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That same trading intensity has also shaped how Solana generates revenue. As the network matures, the challenge will be to reduce memecoin’s impact on revenues and sentiment without undermining the business that has fueled its recent growth.

Fanta pointed out the importance of increasing real economic value (REV) in a way that is less dependent on the maximum extraction value (MEV) induced by memecoin. MEV is a form of revenue generated by ordering trades and can dominate network revenues during periods of intense speculative trading.

“If Solana can continue to grow its REV in a more sustainable and less memecoin-induced MEV manner, institutional investors will take notice and re-evaluate SOL’s value proposition in a completely different risk framework,” Fanta said.

Fanta added that the failure to attract more sedate financial and corporate players, especially as many Web2 companies continue to experiment with EVM-based networks, could limit the scope of this reassessment as Solana moves into 2026.

The case of Solana’s bull and bear

As Solana moves into 2026, the network’s prospects increasingly come down to execution. The bull case, Fanta said, hinges on infrastructure modernization to ensure it is fit for purpose and modern forms of financial activity gain real momentum.

Successful Firedancer implementations and proposed consensus changes, combined with the growth of tokenized funds, stocks and other real-world assets, could facilitate Solana generate more sustainable REVs and change the way institutional investors evaluate its risk profile.

Colkitt said derivatives trading in 2025 was a missed opportunity because the network’s last cycle failed to create a credible onchain rival to Hyperliquid. The lack of such a platform reflects a broader challenge facing Solana as it looks to move beyond memecoins toward higher-stakes financial markets.

The downside for Solana is that deep protocol changes augment the danger of a chain halt, which will quickly revive criticism surrounding Solana’s past outages and weigh on sentiment.

Fanta argued that the failure to attract larger Web2 and financial companies, many of which are still experimenting with networks based on the Ethereum virtual machine, could limit Solana’s growth even if its performance advantages persist.

For builders like Stadnyk, the outcome depends on whether Solana manages to turn its technical advantages into something reliable.

“Solana is the first environment where this vision is actually possible: low latency, predictable finality, low-cost status reads and tools that no longer feel experimental,” he said, referring to real-time automated trading systems.

Stadnyk said 2026 could be the year Solana shows that full-stack onchain trading can operate at a level previously reserved for centralized exchanges.

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