What is Solana (SOL)?
Solana is a decentralised blockchain that serves as a foundation for building dApps, characterised by scalability, security, and user-friendliness.
Solana claims to be the blockchain with unmatched speed and a rapidly expanding crypto ecosystem, supporting thousands of DeFi, NFT, and Web3 projects. Furthermore, a variety of tokens can be issued on the Solana blockchain.
One of the distinguishing features that sets Solana apart is its high throughput. Capable of handling over 65,000 transactions per second (as opposed to the previously mentioned 50,000 tps), it provides formidable competition to leading blockchain giants, Bitcoin and Ethereum. This impressive speed is, in part, thanks to its low transaction fees and unique scalability solution. Designed to evolve with Moore's Law, Solana ensures its performance will continue to advance as technology does.
Another strength of Solana lies in its decentralisation. It maintains a robust degree of this, fostering a secure and resilient network.
- Solana is a blockchain optimised for hosting scalable and decentralised applications.
- SOL is Solana's native token, playing a crucial governance role in the ecosystem.
- Without compromising decentralisation, Solana can achieve up to 65,000 transactions per second.
Proof of History: The Game-Changer
Unlike Bitcoin and Ethereum, which operate on Proof of Work (PoW) and Proof of Stake (PoS) consensus mechanisms, respectively, Solana has developed its unique consensus algorithm named Proof of History (PoH). This groundbreaking mechanism allows the network to achieve higher throughput and reduced latency. PoH creates a historical record of events on the blockchain, providing a verifiable timestamp for each transaction. This function allows Solana to process transactions in parallel, greatly enhancing the network's throughput.
Solana's incorporation of Proof of History, combined with Proof of Stake, characterises its scalability. While the Proof of Stake mechanism with the Tower Byzantine Fault Tolerance (BFT) algorithm assists in validating transactions and ensuring the network's security, Proof of History maintains order, recording the passage of time and ensuring validators wait a sufficient duration before progressing the network.
Who created SOL?
The inception of Solana was in 2017 by Anatoly Yakovenko. His experience at leading tech giants such as Dropbox and Qualcomm inspired the creation of a blockchain that overcame throughput limitations seen in Bitcoin and Ethereum. Along with partners Eric Williams and Greg Fitzgerald, the trio pioneered Solana's unique features. Funding began in 2018, and by the public token sale in March 2020, they had garnered over $21.76 million.
Backing Solana's potential is a team with experience spanning top-tier global organisations like Apple, Intel, Google, and Microsoft. Financially, Solana has gained support from notable investors like Multicoin Capital, SLOW Capital, and Abstract Ventures. The Solana Foundation, a non-profit based in Switzerland, also champions its development and community expansion.
What is the SOL token?
SOL is the native token of the Solana blockchain. Launched in March 2020, the SOL token is considered one of the top 10 cryptocurrencies by total market capitalisation.
SOL is used to transfer value, enable token holders to validate transactions through staking, participate in governance, get rewards and pay transaction fees.
Solana also gives out inflation-based rewards to its weighted validators. The size of the reward is based on the number of tokens staked, and the yield is equivalent to the number of tokens staked measured against the entire token supply.
Solana had an original inflation rate of 8%, which is set to reduce by 15% per year until it reaches a final rate of 1.5% annually.
There are 325,986,746 SOL tokens in the circulating supply, with the maximum supply is not available.
According to Messari , this was the initial SOL token distribution:
- 15.86% - Seed Round investors
- 2.63 - Founding Sale investors
- 5.07% - Validator Sale investors
- 1.84% - Strategic Sale investors
- 1.6% - Public Auction Sale investors
- 12.5% - members of the team
- 12.5% - Solana Foundation
- 38% - Community reserve fund
How to buy SOL?
You can easily add SOL to your portfolio, you just need to follow these steps:
- Step 1: Download and install the SwissBorg app.
- Step 2: Set up your SwissBorg account. You can find detailed information on the Opening an Account page in the SwissBorg Help Center .
- Step 3: Transfer (fiat or crypto) funds into your SwissBorg account.
- Step 4: Go to the Marketplace section (Buy Cryptos) of the SwissBorg app from the tab "Invest".
- Step 5: Find the SOL token listing in the app by simply typing SOL into our search feature, marked with a magnifying glass icon in the top-right corner of the screen.
- Step 6: Tap "Buy", select the fiat or cryptocurrency you want to use for the purchase, enter the amount you wish to spend on the purchase, and tap on "Next".
- Step 7: Tap on "Confirm exchange" to complete the process.
Putting it all together
Solana is seen as a game-changer that tackles important issues of earlier blockchain technology. By doing this, it presents itself as serious competition to Bitcoin and Ethereum.
Many developers believe that due to its speed, which results in low fees and low congestion, Solana could potentially scale to a point where it would rival centralised payment processors like Visa.
With its intelligent technologies and innovative Proof of History mechanism, Solana is definitely a platform worth paying attention to.