Solana is regarded as one of Ethereum’s biggest competitors. It is a flexible app to run crypto apps. Its biggest innovation is speed. It can process 50,000 transactions per second which is much faster than all the other compared blockchains.
Some of the obvious benefits of high transaction speeds are low congestion and low fees. Due to high speeds and low fees, developers hope this blockchain platform will rise and compete with centralized payment processors like Visa.
Solana’s native currency, SOL, is used to pay transaction fees and also for staking. Blockchains have one downside compared to centralized networks, they are slow. Ethereum blockchain processes very few transactions, only 15 transactions per second. SOL platform aims to provide new crypto solutions that will make the crypto network faster and more scalable.
Consensus Mechanism
Solana uses a unique consensus mechanism called the proof-of-history(POH). This consensus mechanism facilitates high throughput and low latency. It uses a cryptographic method to record the time between transactions and the sequence of the transactions.
The proof-of-history consensus mechanism can be implemented simultaneously with other consensus mechanisms like Proof-of-stake and Proof-of-work. POH consensus is responsible for improving the efficiency and flexibility of Proof-of-stake on SOL. It also guarantees effective decentralized security for blockchain protocols.
How the proof of history would draw attention towards the main objective of consensus mechanism. As the rate of communication increased notably, the need for standardized time emerged as a compulsory requirement. So how can the introduction of the concept of time without a centralized clock in decentralized systems such as blockchain networks be introduced? The time is quite important in the case of distributed systems.
The blockchain network could reach faster transaction processes by timing the transactions in small units. Then why the need for proof-of-history? Many programmable blockchains like Ethereum depend on external programs for assigning median timestamps.
Median timestamps help in the validation of transactions in the same order in which they were registered on the blockchain network. However, with median timestamps, the use of centralized sources denies the principles of decentralized systems.
Proof-of-history resolves the problem by authorizing direct integration of timestamps on the blockchain network. The main element in POH consensus refers to the Verifiable Delay Function or VDF. Solana implements the VDF by including data in the transaction sequence by following a new approach.
Architecture
Solana’s architecture is highly scalable and efficient. The blockchain platform’s unique network architecture brings together proof-of-stake (PoS) and Proof-of-history (PoH). PoH is a way to improve the PoS mechanism.
The PoS allows validators to verify transactions based on the amount of SOL owners hold and stake while PoH timestamps the transactions which will result in high throughput and increased efficiency.
The owners with Proof-of-stake, stake their coins to the validators. The validators are the computers that are running on the blockchain software and downloads the copy of the ledger. The validators on SOL platform are like the miners and nodes of proof-of-work but they do not compete with one another to add the next block of transaction in the blockchain.
However, a validator is selected randomly from the selected group based on how much crypto they staked, how long they were staking, etc. This procedure is the way to measure the validator’s commitment to the network and the reward for it.
PoH, which is called the clock for the blockchain. Its sequence of computations acts as a cryptographic digital record giving proof of verifiable order and passage of time between events.
Smart Contracts
Smart contracts in Solana are called programs. Rust, C, and C++ are the languages used to write programs that are deployed on chains. The smart contracts in Ethereum consist of both logic and state whereas the SOL contains only logic that developers place on chains in read-only mode.
Once installed, programs can be accessed by external accounts that contain data related to the program. Thus, there is a logical separation between state and logic, a sharp contrast with traditional EVM-enabled contracts. The accounts of SOL and other blockchains are different. Solana’s account stores data as opposed to other accounts like Ethereum which only specifies the user’s wallet.
Use cases
The list of use cases includes the DeFis, Lending Protocols, NFT apps and marketplaces, Web3 Apps, and Games. The decentralized financial institutions (Dei) provide a combined range of online financial services without the need for any regular bank. Some examples of DEX on this blockchain platform include Orca, Serum, etc.
Apricot Finance and Solend are some of the lending protocols working on this blockchain platform where users deposit and lend currencies. This platform is also used to create the NFT applications. The users can build marketplaces where NFT storefronts or tools generate NFTs.
Multiplayer worlds like Chainers and Aurory games are on the Solana blockchain. Web3 Apps like Audius which is a decentralized audio streaming app that facilitates users to share and listen to music from all over the world are on this blockchain.
Conclusion
Solana is a blockchain platform that achieves very fast, scalable solutions. It includes the proof-of-history mechanisms. The blockchain facilitates traders and developers to provide a variety of services to people from all over the world. Developers with their creativity can achieve new heights through this platform. The speed and the scalability give it an advantage over other blockchains.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
Source: https://www.thecoinrepublic.com/2023/10/22/solanas-innovative-technology-creating-difference-from-others/