What Is Solana (SOL)?
Solana (SOL) Is a highly active open source project that banks on blockchain technology’stechnology’s permissionless nature to provide decentralized finance (DeFi) solutions. While the idea and initial work on the project began in 2017, SOL was officially launched in March 2020 by the SOL Foundation, with headquarters in Geneva, Switzerland.
The Solana protocol is designed to facilitate decentralized app (DApp) creation. It aims to improve scalability by introducing a proof-of-history (PoH) consensus combined with the blockchain’s underlying proof-of-stake (PoS) consensus.
Because of the innovative hybrid consensus model, SOL enjoys interest from small-time traders and institutional traders alike. A significant focus for the SOL Foundation is to make decentralized finance accessible on a larger scale.
Who Are the Founders of Solana?
Anatoly Yakovenko is the most important person behind Solana. His professional career started at Qualcomm, where he quickly moved up the ranks and became senior staff engineer manager in 2015. Later on, his professional path shifted, and Yakovenko entered a new position as a software engineer at Dropbox.
In 2017, Yakovenko started working on a project which would later materialize as SOL. He teamed up with his Qualcomm colleague Greg Fitzgerald, and they founded a project called SOL Labs. Attracting several more former Qualcomm colleagues in the process, the SOL protocol and SOL token were released to the public in 2020.
What Makes Solana Unique?
One of the essential innovations Solana brings to the table is the proof-of-history (PoH) consensus developed by Anatoly Yakovenko. This concept allows for greater scalability of the protocol, which boosts usability.
Solana is known in the cryptocurrency space because of the incredibly short processing times the blockchain offers. SOL hybrid protocol significantly decreases validation times for transaction and smart contract execution. With lightning-fast processing times, SOL has attracted a lot of institutional interest.
The Solana protocol is intended to serve both small-time users and enterprise customers alike. One of SOL main promises to customers is that they will not be surprised by increased fees and taxes. The protocol is designed in such a way as to have low transaction costs while still guaranteeing scalability and fast processing.
Combined with the longstanding professional expertise creators Anatoly Yakovenko and Greg Fitzgerald bring to the project, Solana is ranked number 7 in the CoinMarketCap ranking as of September 2021.
This came from an impressive bull run, where Solana’s price gained over 700% since mid-July 2021. The launch of the Degenerate Ape NFT collection sent SOL price to an all-time high (ATH) above $60, and it has been climbing since, largely due to higher developer activity on the SoL ecosystem, greater institutional interest, growing DeFi ecosystem, and the rise of the NFTs and gaming vertical on SOL. Solana’s price rose to $216 on September 9, 2021.
Solana has received much praise for its speed and performance and has even been tipped as a rival that can compare to Ethereum and challenge the dominant smart contract platform. However, the network has been plagued by repeated outages that have impaired its price and aspirations to be the “Visa of crypto.” Furthermore, its ecosystem is accused of favoring venture capital investors with unfair tokenomics.
This has led to a retrace in the price of SOL as of February 2022, and more short-term bearish price action cannot be ruled out. However, in the long run, SOL should appreciate thanks to strong support from exchanges like FTX.
How Many Solana (SOL) Coins Are There in Circulation?
The Solana Foundation has announced that 489 million SOL tokens will be released. At the moment, about 260 million of these have already entered the market.
The SOL token distribution is as follows: 16.23% went towards an initial seed sale, 12.92% of tokens were dedicated to a founding sale, 12.79% of SOL coins were distributed among team members, and 10.46% of tokens were given to the SOL Foundation. The remaining tokens were already released for public and private sales or are still to be released to the market.
During the initial seed sale held on April 5, 2018, Solana’s price was $0.04. Given the recent ATH, that represents an impressive 5400X return on investment (ROI).
How Is the Solana Network Secured?
Solana relies on a unique combination of proof-of-history (PoH) and proof-of-stake (PoS) consensus mechanisms.
Proof-of-history is the main component of the SOL protocol, as it is responsible for the bulk of transaction processing. PoH records successful operations and the time between them, thus ensuring the trustless nature of the blockchain.
The proof-of-stake (PoS) consensus is used as a monitoring tool for the PoH processes, and it validates each sequence of blocks produced by it.
Combining two consensus mechanisms makes SOL a unique phenomenon in the blockchain industry.
Where Can You Buy Solana (SOL)?
SOL tokens can be purchased on most exchanges. One choice to trade SOL is on Binance, as it has the highest SOL/USDT trading volume, $753,103,225, as of September 2021.
Next is Coinbase, with a trading volume of $343,872,841. Other options to trade Solana include FTX, Bilaxy, and Huobi Global. Of course, it is important to note that investing in cryptocurrency comes with a risk, just like any other investment opportunity.