Solana is a cryptocurrency that runs on decentralized blockchain technology. Solana has been a hot topic among investors following a big jump in share price that garnered a lot of attention in August. The jump in value was particularly impressive because other cryptocurrencies experienced losses around the same time.
What Is Solana?
Solana founder Anatoly Yakovenco saw a need for better cryptocurrency technology. He published a whitepaper in 2018 that proposed a way to overcome the challenges of processing thousands of transactions without delays.
At the time, Bitcoin and Ethereum processed around 15 transactions per second – slightly less than 1.3 million transactions in a day. This may sound like a lot, but Visa was processing 65,000 transactions per second for the potential to process more than 5.6 billion transactions per day.
How could cryptocurrency compete with traditional money if it couldn’t scale transactions? By June 2018, Solana leaders found a way to process 250,000 transactions per second, making it the fastest cryptocurrency on the market.
There are thousands of cryptocurrencies available to investors. Solana’s main competitors are Bitcoin and Ethereum, which are the two largest cryptocurrencies on the market. Some experts compare Solana to Cardano, with these two cryptocurrencies posing the biggest threat to Ethereum.
What Is the Difference Between Solana and Cardano?
Cardano is currently the fourth-largest cryptocurrency on the market behind Bitcoin, Ethereum and Tether. Cardano was one of the first cryptocurrencies to utilize proof-of-stake validation for transactions. This speeds up transaction times while simultaneously decreasing energy use. The way Cardano processes transactions is better for the environment than many of its competitors.
Solana is currently the seventh-largest cryptocurrency by market cap. What makes Solana such a contender compared to these cryptocurrency giants?
Solana is the company behind blockchain technology. While its value trails almost $25 billion behind Cardano, Solana also has the fastest transaction technology through its decentralized network. Here’s how Solana and Cardano stack up as of Nov. 2, 2021:
24-hour Trading Volume
Pros of Investing in Solana
Here are some of the pros of investing in Solana.
Solana has shown impressive growth in a short period of time. When it first launched in March 2020, Solana’s starting price was $0.77. It gained significantly by September 2021, when each coin’s value was $140.
All cryptocurrencies gain and lose value over time. The COVID-19 pandemic led to market volatility, during which many cryptocurrencies lost value. In fact, Solana most recently continued growing while the larger market in the crypto world had been losing some value.
It also boasts a unique blockchain technology that is a hybrid combination of proof-of-stake and proof-of-history that backs each transaction. It can process transactions even faster than Ethereum, the second largest cryptocurrency.
Solana’s growth and technology pair together well, offering the potential for the cryptocurrency to grow quickly and efficiently. A big part of Solana’s scalability is the ease of use and lower fees for the end user.
Cons of Investing in Solana
Take a look at some of the downsides as well.
Solana has big plans for the future, but many of those plans are still in beta testing. Until plans are put into action by the company, there’s no way to tell how successful it will be.
While user transaction fees are low, setting up Solana hardware is more expensive than other cryptocurrencies. Investors may weigh the pros and cons of the difference in fees to invest in another cryptocurrency that has a lower setup fee.
The way Solana handles transactions makes them much faster to process, but it also takes away from decentralization. For investors seeking a highly decentralized cryptocurrency, Solana may not be the first choice.
Good To Know
A lack of decentralization is a con for many investors, but others appreciate it. More stability means that Solana isn’t as volatile in the ups and downs of the cryptocurrency market.
Solana is an impressive cryptocurrency. With thousands of cryptocurrencies on the market, it stands apart by showing growth consistency and potential. But will it live up to that potential? Only time will tell.
Investors interested in diversifying their cryptocurrency portfolio should take a serious look at Solana. As the creator of blockchain technology, it has deep roots in the industry. This indicates that it isn’t going anywhere anytime soon.
Still, investors need to weigh the pros and cons of Solana as they consider their cryptocurrency portfolio as a whole. Investors should treat Solana as a long-term investment instead of a get rich quick scheme.
Solana (SOL) FAQ
Here are the answers to some of the most frequently asked questions about Solana.
Is Solana the fastest cryptocurrency?
Yes. Even though it comes in behind six other cryptocurrencies as far as value, it is still faster. It boasts 50,000 transactions per second compared to 15,000 to 45,000 transactions for Ethereum.
Is the Solana network stable?
Yes. Solana recently announced a partnership with Tether’s stablecoin. Stablecoins are like a hybrid cryptocurrency that is less decentralized than other cryptocurrencies. While this can be a negative for some investors, it’s a positive for others. Stablecoins hold their value well, in comparison to other cryptocurrencies.
Why is Solana growing so fast?
Solana has lower fees, making it cheap for investors to build on. Its blockchain technology is also second-to-none, making it enticing to investors. When people look at decentralized financing, these two factors play an important role, driving more investors to Solana. As users add more projects to the platform, demand increases. This cycle continues to drive Solana’s value up.
Data is accurate as of Nov. 2, 2021, and subject to change.
Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.
About the Author
Katy Hebebrand is a freelance writer with eight years of experience in the financial industry. She earned her BA from the University of West Florida and her MA from Full Sail University. Since beginning to work full-time as a freelance writer three years ago, she has written on topics spanning many fields, including home building, families and parenting, legal and professional/corporate communications.
Today, Tulip Protocol made the announcement that they have integrated Chainlink Price Feeds in order to better secure their yield aggregating platform that is running on the Solana mainnet. The team had previously stated their intention to integrate Chainlink Price Feeds, and at this point, the connection has been completely put into action. Chainlink is the premier decentralized oracle network in the world, safeguarding tens of billions of dollars in smart contracts. It has diversified its offerings across other blockchains, notably Solana, Fantom, Polygon, BNB Chain, and others.
In a recent blog post, the team behind the Tulip Protocol explained that they had integrated Chainlink to provide users with more confidence that leveraged positions will be liquidated equitably using extremely accurate price data and that the protocol will continue to be completely collateralized at all times.
According to Tomasz Wojewoda, Head of Global Sales at Chainlink Labs:
“We’re pleased that Tulip Protocol has integrated Chainlink Price Feeds on Solana, helping secure its yield aggregation protocol with highly robust, decentralized market data. With the high-throughput performance of Solana and the strong security guarantees of the Chainlink Network, Tulip Protocol is able to empower users with a performant and secure platform.”
Tulip Protocol Seeks To Take Advantage Of Solana
Tulip Protocol brings together lenders who receive a return on their deposits and borrowers who are interested in gaining access to leverage. Users who initiate leverage positions are responsible for maintaining a loan-to-value (LTV) ratio that has been previously established. The Tulip Protocol then uses the asset price data that is provided by Chainlink Price Feeds to verify that this ratio is accurate. If the value of the collateral falls below the threshold that was established by the protocol, then their position will be immediately liquidated to assist in guaranteeing that the lenders will be repaid.
Tulip Protocol intends to capitalize on Solana by giving users the ability to more regularly reinvest their income and grow their assets without having to pay exorbitant amounts of gas expenses. Chainlink oracles can now be natively integrated on Solana, making it possible for Solana-based applications to benefit from enhanced levels of security and transparency. Yesterday, OpenOcean made the announcement that they would be integrating Chainlink Price Feeds in order to help secure the limited order functionality on many chains. These chains include Avalanche, Ethereum, Polygon, Fantom, and BNB Chain.
According to Senx, Co-Founder of Tulip Protocol:
“We’re excited to be using Chainlink Price Feeds on Solana to help secure our yield aggregation platform. By leveraging the most secure and reliable on-chain data available, we’re able to provide our lenders and borrowers with greater assurances that liquidations are based on accurate price data, and the protocol will maintain a healthy loan-to-value ratio through all market conditions.”
Allowing Stakers To Benefit From Higher APYs
Natives of the blockchain as well as newcomers to the technology are beginning to understand that decentralization does not necessarily equate to a secure platform. Given that Web3 services are currently disclosing their susceptibilities to attacks from both within and outside the network, further initiatives should be undertaken to improve the safety of user assets. Fortunately, a growing number of blockchain businesses are beginning to add various levels of security to their services in order to solidify the trust of their existing customers and attract additional investors in the near and distant future.
Tulip Protocol is the very first yield aggregation platform to be built on Solana, and it features auto-compounding vault techniques. The dApp was developed to make use of Solana’s blockchain, which has a low cost and high efficiency, hence enabling the vault techniques to compound frequently. Stakeholders are able to reap the benefits of greater APYs as a result, without the need for active management.
On this week’s episode of “The Market Report,” Cointelegraph’s resident experts discuss the latest updates concerning the recent Solana (SOL) hack.
To kick things off, we broke down the latest news in the markets this week:
Bitcoin realized price bands form key resistance as bulls lose $24K, significant whale activity between $22,000 and $24,800 adds to the complexity of the current spot market setup. Bitcoin (BTC) consolidated lower on Aug. 9 after familiar resistance preserved a multi-month trading range. When will we finally break out of this price range and make the move towards $30K?
Circle freezes blacklisted Tornado Cash smart contract addresses, Crypto data aggregator Dune Analytics said that, on Monday, Circle, the issuer of the USD Coin (USDC) stablecoin, froze over 75,000 USDC worth of funds linked to the 44 Tornado Cash addresses sanctioned by the U.S. Office of Foreign Assets Control’s Specially Designated Nationals and Blocked Persons (SDN) list. Could this mark the end for Tornado Cash or is there a way they can redeem themselves?
Next up is a new segment called “Quick Crypto Tips,” which aims to give newcomers to the crypto industry quick and easy tips to get the most out of their experience. This week’s tip: Have some funds ready to buy further downturns.
Market expert Marcel Pechman then carefully examines the Bitcoin and Ether (ETH) markets. Are the current market conditions bullish or bearish? What is the outlook for the next few months? Pechman is here to break it down. The experts also go over some markets news to bring you up to date on the latest regarding the top two cryptocurrencies.
After Marcel’s market analysis, our resident experts discuss whether your SOL is safe and the latest updates on the Solana hack. We also discuss why the network has been victim to so many hacks and downtimes. What exactly do these exploits mean for the Solana platform and if you should be worried.
Lastly, we’ve got insights from Cointelegraph Markets Pro, a platform for crypto traders who want to stay one step ahead of the market. The analysts use Cointelegraph Markets Pro to identify two altcoins that stood out this week: Radicle’s RAD and DigiByte’s DGB.
Do you have a question about a coin or topic not covered here? Don’t worry. Join the YouTube chat room, and write your questions there. The person with the most interesting comment or question will be given a 1 month free subscription to markets Pro worth $100!
The Market Report streams live every Tuesday at 12:00 pm ET (4:00 pm UTC), so be sure to head on over to Cointelegraph’s YouTube page and smash those like and subscribe buttons for all our future videos and updates.
Singapore, Singapore , Aug. 09, 2022 (GLOBE NEWSWIRE) — Today, the ZepetoX team (ZTX, ZepetoX.io) announced its foray into the web3 space, sharing its vision to build an open world that empowers creators and communities to build, play and earn.
ZepetoX is the crypto metaverse initiative jointly incubated by ZEPETO – Asia’s largest metaverse platform with over 320 million registered users – alongside leading global blockchain organizations including Jump Crypto.
As the sole blockchain project comprehensively backed by ZEPETO, ZepetoX will have exclusive ties to ZEPETO in terms of IP including technological, design, and content assets as well as bridges to facilitate user onboarding between the two platforms. ZepetoX’s blockchain development efforts will be advised by Jump.
“ZepetoX is our official venture into the blockchain industry. We feel that web3 opportunities should be advanced through a crypto-native approach, which is why we are excited to have Jump as a contributor to developing a new platform that would have exclusive connections to ZEPETO. Overall, we believe that ZepetoX can build the ideal web3 platform to not only bring blockchain to our existing users but also to expand our footprint in the blockchain space through various disruptive initiatives,” said Daewook Kim, CEO of Naver Z – the operating entity of ZEPETO.
“We are excited to support ZepetoX’s efforts aimed at onboarding new audiences into the rapidly growing crypto space. ZEPETO’s expertise and technological know-hows accumulated over the past years from building an immersive social platform will serve as a springboard for ZepetoX,” said Saurabh Sharma, Partner at Jump Crypto.
Building on the Solana network, ZepetoX will offer a web-based 3D open world with varying levels of gamification integrated as well as opportunities for users to monetize via ownership of digital assets and social interaction. Ultimately, ZepetoX aims to empower self-expression through customizable avatars and lands that can be equipped with NFTs from a rich collection of assets created by diverse creators, DAOs, or communities.
“I am thrilled to see IP powerhouses like ZepetoX choosing to build their metaverse on Solana,” said Anatoly Yakovenko, Co-Founder of Solana. “Projects like ZepetoX create new pathways for onboarding millions of users to web3.”
“Our global team brings a depth of crypto native experiences and our goal is to build on the foundation of ZEPETO to spearhead the adoption of blockchain among metaverse users, developers, and creators,” said co-CEO of ZepetoX, Chris Chang.
In the coming months, ZepetoX will launch its first land sale. The lands will be tradable on the ZepetoX marketplace, which will feature a variety of different NFTs as the open world project evolves. Further details on the sale will be available on the ZepetoX website in the coming weeks.
# # #
About ZepetoX: ZepetoX (ZTX) is a web3 company building an immersive content-driven platform for users to create, trade digital assets and enjoy social interaction. Founded in 2022, ZepetoX is the blockchain initiative of ZEPETO, widely regarded as the largest Asia-based metaverse platform boasting over 320 million lifetime users with over 2.5 billion virtual fashion items sold.