Scalability is one of the most challenging aspects of blockchain technology to come across. As these networks expand, they often face transaction speed and confirmation time constraints. Solana attempts to address and solve these issues while maintaining security and decentralization.
But what is Solana Crypto, and when did it come into existence?
What Is Solana Crypto?
- Solana (SOL) is a cryptocurrency used to pay for transactions on a decentralized computing network.
- It is built on top of the Solana network, benefiting from the main blockchain's speed and reliability.
- It attempts to increase blockchain scalability by combining proof-of-stake and proof-of-history consensus.
- It is capable of processing 50,000 transactions per second while maintaining decentralization.
What Is SOL Token?
- Solana's ecosystem uses the SOL token as its native currency.
- It can be transferred between nodes in the Solana cluster in exchange for running on-chain programmes or certifying their results.
- SOL currently has a circulating supply of 26 million units, with a maximum supply of 489 million.
- Lamports, a type of micropayment, can also be made using SOL.
History of Solana
Anatoly Yakovenko
- Anatoly Yakovenko established the Solana (SOL) platform in 2017.
- Before launching Solana, Yakovenko worked at Qualcomm and served as a Software Engineer at Dropbox, after which he gained a wide spectrum of knowledge about development of operating systems and compression methods. He also led distributed systems at Mesosphere.He developed a new method of dealing with typical throughput difficulties like delayed transactions in the Bitcoin and Ethereum blockchains with the help of Eric Williams and Solana's CTO, Greg Fitzgerald.
- They intended to develop a trustless, distributed protocol with increased scalability.
- The team now has experience from leading companies worldwide, including Apple, Qualcomm, Intel, Google, Microsoft, Twitter, Dropbox, etc.
Features of Solana Crypto
- Scalability - To scale at the rate of Moore's Law, Solana employs Proof of History and several other ground-breaking capabilities.
- Low Cost - For applications with billions of users, Solana is designed to keep the transaction fee down. As a result, you'll never have to worry about your fees escalating as your user base expands.
- Composability - The single global state of Solana guarantees project composability. Multiple shards and layer two systems should never be dealt with.
Proof-of-History
- The Solana network has 200 physically different nodes and can handle more than 50,000 TPS using GPUs.
- It is one of the world's most performant permissionless blockchains.
- Unlike Bitcoin, which employs the PoW algorithm as the system's decentralized clock, Solana crypto uses the Proof-of-History technique.
- Proof of History is used to construct historical records that verify an event occurred at a given point in time.
- This algorithm is a Verifiable Delay Function with a high frequency. To evaluate this function, you'll need to take a certain amount of steps in order.
- Each transaction or event examined will be assigned a unique hash and a count that can be verified publicly and effectively.
- The count serves as a cryptographic time-stamp, allowing us to determine when each transaction or event occurred.
- This provides increased throughput and efficiency within the Solana network.
Working of Solana
Solana has built a one-of-a-kind method for determining the time of a transaction known as Proof-of-History. This is a step-by-step guide on how it works:
Step 1: Input the details of transactions performed in the network to its Leader.
Step 2: The Leader will now efficiently sequence and organize the messages processed by other nodes.
Step 3: The Leader then executes the transactions based on the RAM's current state.
Step 4: The completed state's transactions and signature will then be published by the Leader to the Verifiers (replication nodes).
Step 5: The verifiers will undertake the same transactions on their copies of the state and publish their signatures if the state receives confirmation.
Step 6: The consensus process will then use the published confirmations as votes.
Working of Solana Network
Comparison Between Solana and Ethereum
Solana |
Ethereum |
|
|
Transactions per second |
65,000 |
15 |
|
The average fee per second |
$0.0015 |
$15 |
|
Transaction Latency |
0.4 sec |
5 min |
|
No. of Validators |
702 |
11,000+ |
|
Total Transactions till date |
15 Billion |
1.07 Billion |
Price and Volume of Solana
- The Solana network can process more than 50,000 transactions in one sec, and
- The current price of Solana is 30 dollars with a circulating volume of 270 million SOL coins.
This is quite impressive considering its period in market capitalization as well as compared to other cryptocurrencies.
Future of Solana
- Solana, although being a new project, has delivered on its promises of speed and scalability.
- Its token price has also done well, attracting investors' attention. Nonetheless, the network's acceptance and usage are still in their early stages.
- We won't know whether Solana's speed makes a significant difference in the bitcoin realm until we witness substantial traffic and more use cases.
- Having a fast network is beneficial, but the advantages will only accrue as more people utilize it and more use cases emerge.
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Conclusion
In this tutorial, you came across the subject of Solana Crypto and its concepts such as what it is, how it originated, its features and how it works, Proof-of-History, and its comparison with Ethereum.
Whether you're a skilled Blockchain developer or just a fresher who is new to this concept and wants to explore and learn more about the crypto world, various cryptocurrencies, and the entire mechanism and technology behind cryptocurrencies on Blockchain networks, this course is for you. With all levels of experience, Simplilearn's Blockchain Certification Training curriculum will help you comprehend, learn, and discover more about cryptocurrencies, Blockchain, and related technology such as programming languages and upgrades.
If you have any query or doubts, feel free to drop them in the comments section of this ‘Solana Crypto: The Rising Star of the Crypto-Market’ tutorial; our experts will get back to you as early as possible.
