Solana's (CRYPTO: SOL) ecosystem showed notable financial and institutional growth in the year’s third quarter, securing $173 million in new funding across 29 projects despite a slowdown in the number of funding rounds, according to a new Messari report.

What Happened: This 54% quarter-over-quarter increase represents the highest quarterly funding total since Q2 2022, highlighting investor confidence in Solana’s infrastructure and DeFi solutions, Messari writes.

A notable aspect of Solana's growth is its appeal to institutional giants.

“Solana has caught the attention of major players like Visa, PayPal, and Franklin Templeton, each of whom expanded operations on Solana this quarter," the report states.

With Solana now holding $123 million in tokenized treasuries, it ranks third globally in this category, trailing only Ethereum (CRYPTO: ETH) and Stellar, and edging closer to rivaling Ethereum's dominance.

This stronghold in tokenized treasuries reflects a "shifting landscape" in blockchain adoption, with more financial entities recognizing the unique offerings of Solana's network.

Messari’s report further highlights key advancements in Solana's infrastructure.

The Q3 launch of Solana's V1.18 upgrade and the live deployment of Firedancer on the mainnet in non-voting mode significantly enhanced transaction scheduling and block production capabilities.

The addition of Light Protocol and Helius's ZK Compression solution also aimed to address scaling, an area where Solana continues to make strides.

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“The real-time upgrades and attention to network efficiency are vital as Solana prepares to scale further,” says the report, suggesting that Solana's technical advances are setting it apart in the competitive landscape of blockchain networks.

Solana's DeFi sector has also seen robust growth, with a 26% rise in total value locked (TVL), reaching $5.7 billion.

This development placed Solana ahead of Tron (CRYPTO: TRON) by the end of September and signals heightened DeFi activity on the network.

Kamino, a DeFi protocol within Solana, saw notable growth, with its TVL hitting $1.5 billion, propelled by PayPal's USD stablecoin (CRYPTO: PYUSD) and other assets.

"These TVL increases highlight a surging interest in DeFi products on Solana, particularly those focused on yielding higher returns," the report observes, adding that innovations such as Kamino's lending orderbook and spot leverage are set to bolster Solana's DeFi market presence.

In terms of adoption, stablecoin PYUSD marked a new milestone, ending Q3 with a 341% increase in circulating market cap on Solana.

"Institutional interest isn't just a phase," the report emphasizes, "it reflects a broader shift where major financial entities view Solana as a reliable network for their blockchain ambitions."

As Solana moves into Q4, it continues to attract attention from both institutional and retail users, evident from its $71 billion market cap—an increase of 5% from the previous quarter.

What’s Next: For a comprehensive look at how these developments impact the broader market, Benzinga's Future of Digital Assets event on Nov. 19 offers timely insights.

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