in , ,

Solana (SOL)

So, what exactly is Solana?

Solana is a blockchain platform for decentralized and scalable applications. Solana is an open-source project now managed by the Solana Foundation in Geneva, with the blockchain developed by Solana Labs in San Francisco. 1 In comparison to other blockchains like Ethereum, Solana is substantially faster in terms of transaction processing and has significantly cheaper transaction costs.

The cryptocurrency based on the Solana blockchain, also known as Solana (SOLUSD) and denoted by the ticker code SOL, has risen about 12,000 percent this year,2 and has a market capitalization of over $66 billion, making it the fifth-largest cryptocurrency by this metric.

Getting to Know the Solana Proof of History Concept

In November 2017, Anatoly Yakovenko, a co-founder of Solana, issued a whitepaper detailing the Proof of History (PoH) idea. PoH is a proof that is used to encode the trustless passage of time into a ledger. It is used to validate the sequence and passage of time between events. 1

According to Yakovenko’s whitepaper, blockchains that were publicly available at the time did not rely on time, with each node in the network relying on its own local clock without knowledge of the clocks of other network participants. Because there was no reliable source of time (i.e., a standardized clock), there was no guarantee that when a message timestamp was used to accept or reject a message, every other network member would make the same decision. PoH overcomes this barrier, allowing every node in the network to rely on the ledger’s recorded passage of time on a trustless basis, which is essential to blockchain’s operation.

History of Solana

Yakovenko formerly worked for top technology businesses such as Qualcomm Incorporated in the field of distributed systems design (QCOM). This experience had taught him that a reliable clock makes network synchronization easier, and that when it happens, the resulting network becomes exponentially quicker, with the only limit being bandwidth. When compared to blockchain systems without clocks, such as Bitcoin and Ethereum, which were struggling to scale beyond 15 transactions per second (tps) globally, a fraction of the throughput handled by centralized payment systems like Visa Inc. (V), which required peaks of 65,000 tps, Yakovenko predicted that using Proof of History would greatly speed up the blockchain.

Yakovenko’s first implementation was done in a private codebase using the C programming language. At the request of his former Qualcomm colleague Greg Fitzgerald, Yakovenko moved the whole codebase to the Rust programming language. Fitzgerald began building the first open source version of Yakovenko’s whitepaper in February 2018 and released the project in March, demonstrating that 10,000 signed transactions could be verified and processed in less than half a second. Soon after, Stephen Akridge, another of Yakovenko’s Qualcomm colleagues, demonstrated how outsourcing signature verification to graphic processors might greatly enhance throughput.

With these project accomplishments under their belts, Yakovenko enlisted the help of Fitzgerald, Akridge, and three others to co-found Loom. The company/project was renamed Solana after the little beach town outside San Diego where the co-founders lived when they worked for Qualcomm, due to the possibility of misunderstanding with an Ethereum-based project with a similar name.

The project was scaled up to run on cloud-based networks in June 2018, and a month later, the business released a 50-node, permissioned, public testnet that could continuously handle 250,000 transactions per second bursts. Solana had completed over 40 billion transactions by December 2021, at an average cost of $0.00025 per transaction.

Solana’s Innovation

Solana’s architecture aims to show that there is a collection of software algorithms that, when combined to construct a blockchain, remove software as a performance bottleneck, allowing transaction throughput to expand proportionally with network capacity. Solana’s architecture meets all three criteria for a blockchain: scalability, security, and decentralization. On a normal Gigabit network, Solana’s architecture provides a theoretical upper limit of 710,000 transactions per second (tps) and 28.4 million tps on a 40-Gigabit network.

The Proof of History (PoH) and Proof of Stake (PoS) models are used in Solana’s blockchain. Validators (those who add transactions to the blockchain ledger) can verify transactions based on how many coins or tokens they own, whereas PoH allows transactions to be timestamped and confirmed swiftly.

Ethereum vs. Solana

Solana’s quickly growing ecosystem and adaptability have naturally garnered comparisons to Ethereum, the most popular decentralized application blockchain (dApps). Solana and Ethereum both support smart contracts, which are essential for running cutting-edge applications like decentralized finance (DeFi) and nonfungible assets (NFTs). However, there are several key distinctions between the two.

Unlike Solana, Ethereum is a Proof of Work (PoW) blockchain, which means that miners must compete to solve hard puzzles in order to validate transactions, which uses more energy and is therefore harmful to the environment.

Solana generated a lot of hype in 2021 because of its clear edge over Ethereum in terms of transaction processing speed and transaction prices. Solana can handle up to 50,000 transactions per second (tps), with an average transaction cost of $0.00025. Ethereum, on the other hand, can only process about 15 transactions per second, with transaction fees reaching a high of $70 in 2021.

However, Ethereum has a first-mover advantage, as it is only second to Bitcoin in terms of market valuation because to its massive ecosystem.

3 The Eth2 update and the switch to a PoS paradigm for Ethereum are both scheduled for 2022; the upgrade is supposed to make the blockchain more scalable, secure, and long-lasting, while also doubling transaction processing speed.

When Solana’s network went down for more than 17 hours on Sept. 17, 2021, due to a spike in transaction volume—which reached at 400,000 transactions per second—and bot activity, the firm’s standing as a newer blockchain company came under scrutiny. While the value of the Sol token originally dropped as a result of the revelation, it has subsequently recovered, reaching a high of nearly $250 in November 2021. 2

Is the SOL Token from Solana available in fractional quantities?
Yes, SOLs can be purchased in fractional amounts known as lamports; a lamport is worth 0.000000001 SOL.

Leslie Lamport, a computer scientist best recognized for his work in distributed systems, was Solana’s greatest technological influence.

What is the current number of SOL coins in circulation?
According to the Solana Foundation, a total of 489 million SOL tokens will be released into circulation, with 260 million already in circulation.

What do you think?

Written by Trevanna Gordon

Leave a Reply

Your email address will not be published. Required fields are marked *

GIPHY App Key not set. Please check settings

What Is the Best Way to Purchase Ethereum?

Burrow Hyperledger