Solana’s Realms Platform Embraces Monetization with New Offerings

Solana’s founder Anatoly Yakovenko and the Realms governance platform are taking steps to address evolving challenges and growth opportunities in the Solana ecosystem. Yakovenko recently highlighted the need for Solana to prioritize hardware scaling over fee increases to manage blockchain congestion, contrasting it with Ethereum’s approach. Meanwhile, Realms, a key governance hub on Solana, is shifting towards a profit-driven model under new management, launching services to support decentralized autonomous organizations (DAOs) while maintaining free core governance tools. 

Realms Shifts to Profit-Driven Strategy Under New Management, Aims to Revolutionize DAO Services on Solana

Realms, a pioneering force in Solana’s (SOL) crypto-governance space, is embarking on a significant transformation as it moves towards a profit-oriented business model. The platform, which has been a critical hub for decentralized autonomous organizations (DAOs) operating on the Solana blockchain, is now under new management by an entity named “Realms Today Trust.” This shift signals a major departure from its origins under Solana Labs, with an ambitious plan to monetize its services while maintaining its commitment to providing essential governance tools for the Solana ecosystem.

Dean Pappas, a veteran Realms contributor and one of the four leaders steering the newly formed spinoff, emphasized that while the organization will introduce paid services, its core offerings will remain accessible. “We need to develop profit services, that way we can continue it,” Pappas said, bringing attention to the necessity of sustainability in Realms’ new mandate. Despite the changes, the governance tools that have enabled dozens of Solana-based DAOs to manage voting, decision-making, and treasury functions will remain free for users.

However, as Realms pivots towards monetization, the project will introduce several premium features aimed at enhancing the DAO experience. Among these are a crypto-advisory service for DAOs to establish robust governance frameworks and an incorporation advisory line to assist in setting up legal structures and bank accounts. Furthermore, a crypto-linked credit card will be made available, allowing DAOs to utilize their digital treasury assets for everyday expenses. These new offerings are expected to attract a share of the estimated $1.5 billion held by DAOs on Realms’ infrastructure.

In an effort to foster the growth of emerging DAOs within the Solana ecosystem, Realms has also announced a $200,000 grant program. These grants will be distributed to promising Solana-based projects as part of the platform’s ongoing support for upstart DAOs. Although Pappas did not disclose the source of the grant funding, the initiative signals a continued commitment to nurturing innovation and decentralized governance on Solana.

Realms is not the first project to evolve out of Solana Labs, the primary development entity behind the Solana blockchain. In fact, the platform follows in the footsteps of Metaplex, which powers Solana’s non-fungible token (NFT) infrastructure and successfully spun off into an independent entity. Matty Taylor, a former Solana Labs contributor who has since taken on a prominent role organizing hackathons for the Solana ecosystem, explained the ethos behind these transitions: “The general ethos of Solana Labs is once things get to a certain point, it’s time for it to become its own standalone thing.”

Realms’ new corporate structure reflects this philosophy. The legal entity Realms Today LTD, which now governs the platform, is owned outright by Solana Labs’ DAO engineer Sebastian Bor, according to UK business records filed in late 2023. The company later added Pappas and Jose Neif Jury from BCB Group as directors, signaling a broader leadership strategy aimed at leveraging diverse expertise in the crypto space.

With a current team of 12 full-time employees, Realms has plans to expand its workforce and extend its technical capabilities. The company aims to develop new frontends tailored to various tokenized governance use cases, moving away from the existing “one size fits all” approach. This expansion is designed to cater to the evolving needs of different DAOs, providing more customized solutions for governance and community management.

Moreover, Realms is considering modifications to the SPL token governance standards. This open-source codebase, which is accessible to all, will potentially be forked by Realms to create new and innovative governance functionalities. The proposed changes aim to build upon Solana’s existing standards while introducing new features to streamline DAO operations.

Navigating Challenges in the DAO Landscape

As Realms embarks on this new chapter, the platform will need to navigate the complexities and regulatory challenges that come with monetizing DAO services. With governments around the world paying closer attention to the legal status of DAOs and their financial activities, Realms’ advisory services could play a crucial role in helping organizations stay compliant while maximizing their growth potential.

The incorporation advisory line and governance consulting services will likely appeal to DAOs looking to establish more formal legal and operational structures, potentially helping them mitigate some of the uncertainties surrounding decentralized governance. By positioning itself as a one-stop shop for DAO formation and governance, Realms could capture a significant portion of the growing demand for professionalized DAO services.

Anatoly Yakovenko Explains Solana’s Strategy to Tackle Blockchain Congestion as ETH Dominance Grows

Anatoly Yakovenko, widely known as “Toly,” the founder of Solana, has shared his insights on the ongoing challenges in blockchain technology, particularly around the interactions between hardware and software. In a recent post on X, Yakovenko contrasted Solana’s approach to network congestion management with that of its main rival, Ethereum, highlighting the fundamental differences in how these two prominent blockchains handle scaling issues. 

Yakovenko’s comments come amid growing competition in the layer-1 blockchain space, where both Solana and Ethereum have emerged as leading networks, each with distinct philosophies on transaction fees and network scaling. His analysis sheds light on the technical and economic decisions that shape the user experience and infrastructure capabilities of these blockchain giants.

In his post, Yakovenko identified congestion management as a key differentiator between Solana and Ethereum. He argued that raising transaction fees to deal with network saturation—a common approach seen in Ethereum—fails to address the root of the problem. From Solana’s perspective, when global resources such as bandwidth and computational power become saturated, relying on price discovery mechanisms (i.e., increased transaction fees) as a congestion solution is ineffective.

Instead, Solana’s philosophy revolves around scaling hardware to accommodate increasing demand. Yakovenko emphasized that the software architecture must allow validators—the entities that process and validate transactions on the network—to enhance their hardware capabilities in response to rising network traffic. If a blockchain’s software does not enable this kind of scaling, Yakovenko argues, it represents a fundamental flaw in the system’s design.

Solana’s approach implies that the network’s capacity can be continually expanded by upgrading hardware, allowing for a more scalable and resilient infrastructure. According to Yakovenko, only local contention, or competition for resources that cannot be scaled up, should lead to fee increases. This means that user fees should be adjusted solely based on localized competition rather than as a reaction to global network congestion.

While Yakovenko champions hardware scaling as a solution to blockchain congestion, he also acknowledged its limitations. He explained that the maximum additional bandwidth that can be achieved through hardware scaling is roughly 1,000 times the cost of the hardware itself, with a scaling constant “K” of no more than 10. This means that while hardware improvements can significantly enhance network capacity, there are practical upper limits to the scalability that can be achieved solely through this approach.

Solana’s focus on hardware scaling is part of a broader strategy to create a high-performance blockchain capable of supporting a wide range of decentralized applications without resorting to excessive fees. This philosophy sets Solana apart from Ethereum, where higher transaction fees are often used to manage congestion during periods of high network demand.

The Ongoing SOL/ETH Rivalry

Yakovenko’s comments come against the backdrop of an intensifying rivalry between Solana and Ethereum, particularly as Ethereum has seen a resurgence in market interest and a recent price surge. The price increase in ETH has impacted the SOL/ETH trading pair, resulting in a relative decline in Solana’s performance against its larger competitor. 

While Solana has experienced impressive growth over the past year, with its ecosystem expanding and attracting new developers and users, Ethereum continues to capture a significant share of capital flowing into the cryptocurrency market. The influx of investment into ETH has outpaced competing layer-1 chains like Solana, contributing to a stabilization in Solana’s USD price, but a decline in its value relative to Ethereum.

Despite Ethereum’s dominance in market cap, some industry voices suggest that the leading blockchain may be losing ground to Solana in specific metrics. Kate Young Ju, an altcoin analyst at CryptoQuant, has observed that Ethereum’s market cap share is gradually shrinking relative to Solana. According to Ju, this trend may indicate a shifting landscape where investors begin to diversify beyond Ethereum and explore other layer-1 alternatives.

Solana has built a reputation for offering high throughput, low-latency transactions, and affordable fees, making it an attractive option for developers building decentralized finance (DeFi) applications, gaming projects, and non-fungible token (NFT) marketplaces. The blockchain’s rapid processing capabilities and ability to handle thousands of transactions per second have positioned it as a viable competitor to Ethereum, particularly in use cases where speed and cost efficiency are crucial.

However, as ETH continues to attract more capital and investor interest, Solana must navigate the challenges of competing with a blockchain that benefits from a robust developer community, established infrastructure, and a well-established DeFi ecosystem.

To maintain its growth trajectory and compete effectively with Ethereum, Solana is doubling down on its unique approach to scaling. By focusing on hardware improvements and optimizing its software to support higher levels of network activity, the blockchain aims to provide a seamless user experience that doesn’t require frequent fee adjustments. This strategy is rooted in the belief that scaling should prioritize infrastructure upgrades over economic deterrence.