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What Is Solana, and Why Is It Called an “Ethereum Killer”?




What Is Solana, and Why Is It Called an “Ethereum Killer”?


Solana is a high-speed and permissionless layer 1 public blockchain that is sometimes called an “Ethereum Killer” because it features cheap fees and fast transactions compared to the often expensive “gas” fees due to high traffic on Ethereum.

Background of Solana

Solana was created in 2017 by Anatoly Yakovenko to build something similar to what other blockchains allow but to keep costs low by increasing performance. To do this, Solana uses a hybrid solution featuring a unique network design that works to sidestep the “blockchain trilemma” that challenges many blockchain designs by positing that blockchains are always forced to make trade-offs between decentralization, security, and scalability.

The experience of using Solana lies in stark contrast to networks like Ethereum as the user experience is vastly improved with transactions that cost a few cents and settle almost instantly. While using Ethereum wallets like MetaMask are obstacles for onboarding new users, the Solana network features smooth decentralized applications with user-friendly interfaces, a thriving NFT ecosystem, and plenty of developers continuing to build out use cases for the technology using the foundation the Solana blockchain offers.

Critics are quick to point out that Solana is more centralized by some definitions than other blockchains and therefore is somewhat removed from the core ethos of the cryptocurrency movement that values decentralization and sovereignty. The Solana network has also suffered a few major outages which are largely being patched but still raises doubts in the eyes of some investors and users.

Architecture and Throughput

The Solana blockchain is engineered to provide high performance when it comes to throughput. Solana uses a hybrid consensus mechanism to validate the chain based on a combination of a special proof-of-history (PoH) algorithm with the ultra-fast synchronization engine called proof of stake (PoS).

Proof of Stake (PoS) means that the consensus mechanism is based on a system of validators that deposit their Solana tokens (SOL) into the protocol as collateral for being a good-faith actor in the verification process of the transactions being added to each block in the blockchain. If the validator is fraudulent or corrupt, their stake of tokens will get slashed, which means their deposit gets forfeited to the protocol. Because Proof of Stake eliminates the complex mathematical computations needed for Proof of Work, it uses significantly less energy,

Because of this, the Solana network can theoretically process over 710,000 transactions per second (TPS) without any scaling solutions needed. The design of Solana gives it a higher performance threshold than other chains, giving users the fast and cheap transactions they are used to when using web2 applications.

Understanding the Solana (SOL) Token

The native cryptocurrency for the Solana blockchain network is SOL, which functions as its utility token needed to pay for transaction fees for using the network, transferring value and compensation for providing security to the chain via staking. The SOL token launched in March 2020 and has since climbed to reach a market capitalization in the top 10 cryptocurrencies.

Solana Token Distribution
Solana Token Distribution The Tie Labs

The current total supply is approximately 523k SOL, with a circulating supply of about 342k SOL as of June 2022 (via Solana). When the Solana network first launched, it had an initial total supply of 500k SOL. However, the Solana Foundation previously burned 11 million SOL. This reduced the total supply down to around 488k SOL.

With new SOL rewarded as Solana staking yield, Solana’s initial inflation is at 8%. This inflation rate will reduce 15% year on year until it settles on what Solana described as its “Long-term Inflation Rate”‘ of 1.5%.

You can purchase SOL on most major centralized exchanges as well as exchange tokens for SOL on many popular decentralized swap or exchange applications.

A Cheaper Alternative

The high gas fees experienced on Ethereum are prohibitive or unattractive for many casual investors or crypto-curious individuals looking to get started in the world of web3.

When Ethereum gas prices spike to high levels making it expensive to use the blockchain, then many cryptocurrency investors and traders look to other blockchains to conduct their trades and NFT trading. Solana’s growth has benefitted from the high gas on Ethereum as users have fled to using Solana for NFTs and decentralized finance (DeFi) such as yield farming or staking.

NFTs on Solana

NFTs Sales Volume by Blockchain
NFTs Sales Volume by Blockchain CryptoSlam

Non-fungible token (NFT) sales on the Solana blockchain crossed the $1 billion mark in total volume in January of 2022. Studying the data shows that overall volume and the number of unique buyers has steadily increased over time, while the average price of each sale has gone down.

The data highlights the world of artists and creators using Solana to make NFTs is growing quickly as many people see the cheap fees as an advantage to onboard newer users to web3 who would otherwise be turned off at the idea of paying $25-40 in gas fees to purchase an NFT. While the top NFT collections on Solana sell for considerably less than the top NFT artworks on Ethereum, Solana has the second-largest NFT ecosystem.

NFT Sales Volume & Unique Buyers
NFT Sales Volume & Unique Buyers CryptoSlam

The cheap fees have also made Solana a go-to choice for many builders in the space who require high performance and cheap fees as part of their business model. Many projects are leveraging these features for cultural, events, music, and artistic use cases that require this kind of throughput to make their projects viable.

The performance of Solana has attracted game developers and there are several high-profile games in production that make use of NFTs including STEPN, a move-to-earn game, and Star Atlas, which is an MMORPG.

Centralization Concerns

Since Solana uses Proof of Stake (PoS) versus Proof of Work (PoW), there are different dynamics at play when it comes to determining the centralization of the validator network. If token accumulation by validators is the greatest factor in deciding who gets to validate the next block of transactions, then they are more likely to be rewarded with the block reward, which the compensation validators receive for securing the network.

These can lead to a scenario in which the rich get richer as those entities or validators who already own an outsize amount of Solana tokens have a clear advantage of earning more than the average user who wants to validate the network. Around 60% of SOL tokens are controlled by Solana’s founders and the Solana Foundation, with 38% reserved for the community.


Solana Uptime Jan - March 2022
Solana Status

Solana blockchain has gone down, meaning it was inoperable, several times in the last six months. According to Solana Status, it has gone down 5 times in 2022. Solana’s worst outage so far was in early January 2022 — this one lasted from January 6 to 12. The network also saw another outage in late January and had a 96.4% uptime during the month.

When the network has gone down, it has been typically due to the failure of the validators to reach consensus and agree on the accuracy of the chain. These inconsistencies have sometimes come from a flood of bots flooding the network with transactions.

Many people in web3 are critical of Solana because of these outages. Some people decry that Solana is not ready for the scale that it hopes to achieve. Others state that these are growing pains, and that the network is experiencing an iterative period of stress tests which are helping Solana become more battle-hardened and robust as weaknesses are exposed and then patched and resolved.

Final Thoughts

In summary, Solana is a layer 1 blockchain that allows for the similar kind of development of decentralized applications as many other smart contract blockchain networks. However, Solana runs on a different consensus mechanism which allows for a higher throughput of transactions offering its users access to low-cost and rapid transactions.

While many are familiar with paying high gas fees on Ethereum to do such activities as decentralized finance or buy and trade NFTs, you can do many of the same things on Solana without the high fees, which has led to an explosion of growth within the Solana NFT ecosystem.

The structural design of Solana leads to many differences between its design and execution when composed with Ethereum. Critics point out the concentrated token holdings as potential risk factors because it makes the blockchain more centralized in some respects because it favors those who hold more tokens to be chosen as validators.

Regardless of these critiques, the Solana ecosystem continues to grow as the cheap and fast transactions have allowed Solana to capture a share of the market that relies on these parameters for their use cases to make sense as a business model. Many entertainment businesses that are blending crypto culture with music, fashion, and art have turned to Solana because of its low fees and attractive onboarding experience.

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Tulip Protocol Officially Integrates Chainlink on Solana Mainnet




Tulip Protocol Officially Integrates Chainlink on Solana Mainnet

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.

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Is your SOL safe? What we know about the Solana hack




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?

Institutions flocking to Ethereum for 7 straight weeks as Merge nears: Report, “Greater clarity” around the Merge has driven institutional inflows into Ethereum products, according to a CoinShares report. Is the ETH merge finally around the corner and will it bring new all time highs to ETH or has the price already been factored into the current price?

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.

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Web3-Based ZepetoX to Build on Solana




Web3-Based ZepetoX to Build on Solana

Singapore, Singapore , Aug. 09, 2022 (GLOBE NEWSWIRE) — Today, the ZepetoX team (ZTX, 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.

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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.



News Via KISS PR Crypto Press Release Distribution Media Contact

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