Solana – Why is it hyped as Eth Killer, and is it worth the hype?

Solana has been one of the ambitious projects that brought a lot of changes and breakthroughs in blockchain technology

• Currently, SOL holds the seventh position in volume in terms of the market capitalization of approx $27 billion

Comparatively, a very new name among the networks is called Ethereum Killer. But what exactly does it need to be an Eth killer, and does the Solana Blockchain have the potential to beat the first smart chain network in the market full of competitors with tons of unique features. Let’s find out —

About Solana

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Anatoly Yakovanko, a senior engineer manager at Qualcomm and later at Dropbox as a software engineer, quit his aspirated jobs and started working on a project. In 2017 he moved ahead, worked on a project with his colleagues, and founded Solana Labs, headquartered in Geneva, Switzerland. Later on, as the project developed, they launched their anticipated blockchain network Solana in march 2020.

Blockchain tech from beginning till Solana

Earlier, the Bitcoin blockchain was only meant for transactions purposes, but Ethereum brought so many other utilities of using blockchain for various aspects. Smart contracts, decentralized finance (DeFi), decentralized autonomy organizations (DAO), and many other fancy crypto innovations are heard today were possible on the Ethereum blockchain.

But as Ethereum introduced and solved uses of blockchain after Bitcoin, many problems facing Ethereum had also been opportunities for new blockchains to come. Various blockchains have been introduced from Cardano to Binance Smart chain, 

Polygon to Polkadot, all the famous names in the crypto market have their own USPs and abilities. Solana has also removed the issues, but some of the methods behind removing issues are worth discussing. 

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Solana’s working and unique features

Solana blockchain came with numerous developments in contemporary technology, somewhat better than existing ones apart from new ones. It solved many problems and fundamental issues blockchain networks face decentralization, scalability, and security. Although many networks had been there, which resolved them by far, Solana went the extra mile in terms of solution. 

Solving of blockchain trilemma

Ethereum co-founder Vitalik Buterin coined a concept of Blockchain Trilemma, which explains the relation between decentralization, scalability, and security. According to Vitalik, it is impossible to completely have all three desired abilities together in a blockchain. Any network can have two of them at their best, and one will remain compromised.  

However, Solana turned out to solve the issue and was able to secure, scale, and keep the network decentralized simultaneously, which was considered a hard thing to achieve till then. 

Solana’s decentralization

The network adopted a different approach for the sake of a consensus mechanism to secure decentralization and manage the speed simultaneously. It uses a proof-of-history mechanism which was different from then running systems of PoW on which BTC and ETH work and PoS on which new smart chains are working. 

In this system, anyone needed to stake only one SOL to be a validator of a network as proof-of-stakes work, so its entry barrier was too low compared to other networks. Also, while validation, nodes keep track of time with records of transactions; this simple timestamp process saves a lot of time. 

Transaction fees and speed

The network takes the time and fees while transactions remain major issues in Ethereum blockchain, which were solved by the new network, so did Solana but a way better. Solana has boosted its transaction speed to reach 400,000 transactions per second which works at 50,000 tsp still is just so huge from ETH’s 15 tsp. Even the fees are also somewhere around $0.00025

Scalability 

It’s common knowledge that technological advancements go high and provide innovations with time. Developers at the network have kept Moore’s law in consideration and had solutions for scalability issues if faced in the future. The law states that every couple of years, the number of transistors in integrated circuits doubles; in short, the computing power of a system increases two times while size remains the same. 

Solana found an opportunity in this and aligned its development of the system and the processors so that whenever it gets updated, and its computing power goes high, the scalability of the network goes high as well. 

Block Finality Time 

Now, the time taken to complete a block is considered the finality time of the block. Related to transaction speed, finality time will eventually be less when speed is high. Finality time matters a lot in the Blockchain world, and Solana has fame because of this facility.

Project and applications on Solana

It’s obvious to have projects and applications development on the network after having top-notch facilities needed for the operations. Talking about the first Defi project on Solana is Serum, which is a decentralized exchange, its working is different in terms of using the order book method for its transactions. Not just this, various projects of other networks have shifted to Solana for apparent reasons. One of them is Audius, an audio streaming platform earlier on Ethereum that has decided to shift to the Solana network.

Solana’s Ethereum Bridge

The projects or applications on blockchain that are Dapps can move from Ethereum to Solana through the Ethereum Bridge system developed by Solana. This link of the bridge is why people believe that Solana and Ethereum can co-exist together in the future.

Tokenomics of Solana token SOL

The total supply of SOL is estimated to be approx 511 million, out of which 314 million is in the current supply. It had been at its all-time low of $0.50 approx in May 2020, obviously its initial phase, and has surged up to almost $260 in Nov 2021, breaking all records and setting an all-time high. Solana has a total market capitalization of more than $29 billion, due to which it stands at the seventh rank based on market cap value.