Solana Asset Service Protocol Metaplex: The Hidden Beneficiaries of the Meme Craze

1. Introduction

In the current bull market cycle, Solana is undoubtedly the fastest-growing L1 public chain. From the perspective of active address numbers and fee revenue, Solana's market share has shown explosive growth:

• The share of active addresses increased from 3.48% to 56.83%, a year-on-year growth of 1533%.
• The share of fee income increased from 0.62% to 28.92%, a year-on-year growth of 4564%.

The meme token craze is the main driver behind the rapid growth of various core metrics of Solana. In addition to Solana itself, DEX platforms like Raydium have also gained huge revenues due to active meme trading.

This article will focus on another project that benefits from the Solana asset issuance boom: Metaplex.

Mainly discuss the following issues:

• What is Metaplex's business positioning and business model? Does it have a moat?
• How is the business data of Metaplex, and what is the development trend?
• What is the background and funding situation of the Metaplex team?
• What is the current valuation level of Metaplex, and are there any investment opportunities?

2. The Business Positioning and Business Model of Metaplex

Metaplex is a digital asset creation, sales, and management system built on the Solana blockchain and supporting SVM, providing tools and standards for developers, creators, and enterprises to build decentralized applications. The asset types supported by Metaplex include NFTs, fungible tokens, RWA, game assets, DePIN assets, and more.

Recently, Metaplex has also expanded its business into the fields of data indexing and data availability services. In the long term, Metaplex is expected to become one of the most important multi-domain foundational service projects in the Solana ecosystem.

2.1 Metaplex Product Matrix

The main products of Metaplex include:

• Core: A new generation NFT standard, using "single account design", significantly reducing minting costs.
• Bubblegum: a program used to create and manage compressed NFTs ( cNFT ).
• Token Metadata: Attach additional data to assets on Solana
• Candy Machine: The most commonly used NFT minting and issuance program
• Others: including MPL-Hybrid, Fusion, Hydra, etc.

In addition, Metaplex has also launched Aura - a decentralized indexing and data availability network for Solana and SVM.

2.2 Metaplex's business model

Metaplex charges by providing on-chain asset-related services. Although the direct partners are other projects on Solana, most of the revenue comes from small projects or retail users utilizing these projects.

The fee structure of Metaplex is relatively low, with minting an NFT costing only 0.0015 SOL and issuing a Meme token using Token Metadata costing only 0.01 SOL. This low cost is almost negligible for users.

2.3 Metaplex's moat

The moat of Metaplex mainly comes from "high switching costs" and "setting standards":

• The switching cost is high after developers and users become deeply reliant on Metaplex tools.
• The asset format of Metaplex has become the standard within the Solana ecosystem, and new projects tend to choose the more compatible Metaplex.

Thanks to these moats, there are few projects within the Solana ecosystem that can compete with Metaplex, which ensures its strong profitability.

3. Metaplex Business Data: High Product-Market Fit, Strong Growth in Core Metrics

3.1 monthly active users

As of November 30, 2024, Metaplex's monthly active users reached 844,966, setting a new historical high, a year-on-year growth of 253%.

3.2 Asset Minting Quantity

In November, the number of asset types minted through Metaplex exceeded 1.44 million, with 94% being fungible tokens and only 6% being NFTs. This ratio was 18.6% to 81.4% in January 2023.

3.3 protocol revenue

In November, Metaplex's monthly protocol revenue reached 3.3 million USD, also setting a historical record. It is worth noting that Metaplex's revenue is organic growth and does not involve token subsidies.

4. Metaplex Team: The Ecological OG Close to the Core Circle of Solana

Stephen Hess, the founder of Metaplex, was an early employee at Solana and participated in the development of several important projects. In January 2022, Metaplex secured $46 million in funding from institutions such as Multicoin and Jump, with an estimated valuation of around $450 million.

The team size is streamlined to about 10 people (, but the product iteration and development efficiency are high. Overall, the Metaplex team possesses multiple characteristics of an excellent Web3 team.

![Is the NFT protocol Metaplex underestimated while quietly making a fortune in the Solana Meme craze?])https://img-cdn.gateio.im/webp-social/moments-391fd2cdddc3de14ab09b6eae7010d8e.webp(

5. MPLX: Token Utility and Valuation Levels

) 5.1 Basic Token Information

The total supply of MPLX is 1 billion, and the current circulation rate is 75.6%. Most investors' shares have been realized in circulation, and the unlocking selling pressure is relatively small.

![Is the NFT protocol Metaplex underestimated while silently profiting during the Solana Meme craze?]###https://img-cdn.gateio.im/webp-social/moments-303c4ed8491d582f5cecbc716e2e6060.webp(

) 5.2 token utility

MPLX is mainly used for governance voting. Starting from March 2024, Metaplex will use 50% of protocol revenue for token buybacks, and the repurchased tokens will enter the treasury for ecosystem development. In addition, MPLX will become the staking asset for Aura nodes in the future.

![Is the NFT protocol Metaplex underrated while quietly making a fortune in the Solana Meme craze?]###https://img-cdn.gateio.im/webp-social/moments-ca888d028c835b96b23b757232743604.webp(

) 5.3 protocol valuation

Compared to Raydium, which is part of the Solana ecosystem and benefits from the Meme boom, Metaplex's valuation is slightly higher. However, the business positioning of the two is quite different, and the comparison is for reference only.

![Is the NFT protocol Metaplex underestimated in the Solana Meme craze?]###https://img-cdn.gateio.im/webp-social/moments-d4c5f128d44bfb09a15b7a8809ac10da.webp(

) 5.4 Potential Driving Factors and Risks

The advantages of Metaplex include:

• Located upstream of asset services, directly benefiting from the prosperity of the Solana ecosystem.
• High product market fit, achieving positive cash flow without the need for token subsidies.
• Actively expand the second growth curve
• The team has excellent quality and is closely related to the core ecosystem.
• The token has a buyback mechanism and a relatively low market value.

Potential upward driving force:

• A new active track has emerged in the Solana ecosystem.
• Launching on larger trading platforms to gain liquidity premium
• Increase service fees

Potential Risks:

• The decline of Solana Meme craze has led to a decrease in revenue.
• The income model is difficult to sustain ### one-time charge (

Summary

Unlike the impression of most investors, Metaplex is actually the underlying protocol serving the entire ecosystem of Solana assets and is a direct beneficiary of the Meme craze. For investors optimistic about the future development of Solana, Metaplex is worthy of long-term attention.

![Is the NFT protocol Metaplex undervalued in the Solana Meme craze?])https://img-cdn.gateio.im/webp-social/moments-b6761627a22ec603f0cd623b463422a9.webp(