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Solana: the blockchain that combines speed and security

By Negativeland | Negativeland | 27 Dec 2023


 

Born in 2018 from an idea by programmer Anatoly Yakovenko, Solana is one of the blockchains with the greatest potential thanks to the speed and security of transactions

 

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Solana: a little history

In the immense crypto landscape, Solana is one of the brightest and continuously growing projects.

This blockchain is in fact equipped with various peculiarities that make it very interesting; we will soon discover them.

Currently, Solana is one of the protagonists of our niche, the world of cryptocurrencies.
In the years to come, it is reasonable to expect that this chain will become one of the main players in various sectors, from gaming to payment systems, thanks above all to its scalability and speed.

Solana's idea came to life at the end of 2017 thanks to Anatoly Yakovenko, a telecommunications programmer, employed at Qualcomm and with work experience also at Dropbox and Mesosphere.

It was precisely this professional background that led to the great intuition: the creation of the Proof-of-history consensus algorithm.

Yakovenko knew well how synchronism is essential in a network: in this way, every movement becomes efficient and speed benefits immeasurably.

By carefully observing the main players of the time, such as Bitcoin and Ethereum, Solana's "father" highlighted how the lack of synchrony led to slow transactions, as well as limiting the number to just a few per second.

Cryptocurrencies have always been seen as the future of payment systems. How could we proceed in this sense if the chains could process so few movements simultaneously? How can blockchain be applied to Visa, for example, whose peaks reach 65,000 transactions per second? Finally, how can we still guarantee high standards of security and decentralization?

The answer, although still without the current name, was one: Solana.

Yakovenko began working on the idea, trying to refine it more and more. He was joined by other minds of similar backgrounds, first and foremost his long-time friends Greg Fitzgerald and Stephen Akridge.

Already in February 2018, the first prototype was operational. Before long, Yakovenko and partners founded a company called Loom.

Later, thanks to the arrival of a project on Ethereum called Loom Network, the name changed, taking that of the place where the three friends spent a few years surfing the ocean waves: Solana beach. Shortly thereafter, the revolutionary chain became reality.

 


 

INDEX

  • What is Solana?
  • The SOL coin
  • Solana's strengths
  • The most interesting projects on the Solana chain
  • Solana: the definitive blockchain?

 


 

What is Solana?

Let's start with two questions: what makes Solana so special? Why was the team's telecommunications background so crucial?

The Bitcoin and Ethereum blockchains work according to the Proof-of-Work algorithm, i.e. the one that involves the mining process.

Each transaction requires a certain number of checks to be validated, so as to prevent an attacker from falsifying the data to his advantage.

This process requires the solution of complex mathematical problems by very powerful computers. Originally, mining was for everyone; today, however, there are specialized centers that deal with it (the so-called farms).

The energy expenditure is enormous and also creates complications in terms of environmental impact.

Security is high. However, speed and scalability are at the expense: as Proof-of-Work is a complex procedure, the chain is slow and not very scalable.

The system is therefore not very efficient.

To remedy these limitations, Yakovenko found a way to apply TDMA to the blockchain, of which we see an illustration borrowed from Wikipedia.

 

TDMA Solana

 

Time-Division Multiple Access is a method of operation in the telecommunications world that allows numerous players to use the same frequency.
Trying to make everything as simple as possible:

  • the different antennas of the network are synchronized.
  • each user is assigned a time slot.
  • every operation is completed.
  • in the end, each of them is placed in the right place, respecting the correct order.

TDMA applied to blockchain offers these advantages:

  • Decentralization: the validator nodes are numerous and operate on the same chain. An "internal clock" keeps them all synchronized with each other, guaranteeing the correctness of operations.
  • Speed: since there are many nodes, transactions do not have to follow a rigid path, gaining a lot in speed. We are talking about tens of thousands of transactions per minute!
  • Scalability: again thanks to this system, the chain can grow and offer high scalability.
  • Security: Synchronization makes high security standards possible.

Solana is a blockchain that takes advantage of what we have just seen and works using the Proof-of-Stake with delegation algorithm, in addition to the Proof-of-History based on TDMA.

This system makes it possible for “anyone” to become a validator. In fact, if on the one hand there are still high requirements on hardware and internet connection speed, on the other hand no minimum amount of Solana stakes is required.

Other blockchains use Delegated Proof-of-stake: essentially the same, however it requires very high minimum stake quantities of the native cryptocurrency to be validators. This system therefore makes the environment decidedly centralized.

As of today, November 2023, Solana's validator nodes are 3,400: a high number, especially considering the extreme speed for each transaction. It should be noted that the figure has grown significantly in recent years, more than doubling.

Furthermore, Proof-of-Stake algorithms are basically significantly more powerful than Proof-of-work ones. In Solana's case, the gap becomes even greater.

The ability to grow and adapt to needs makes this chain among the most scalable on the scene. The refined consensus mechanism makes Solana one of the safest environments to operate in the world of cryptocurrencies.

Finally, an important note: the cost of transactions is negligible!

 

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The SOL coin

The protagonist of Solana is its coin SOL.

Let's examine its use cases and its value.

First, each transaction is paid in SOL. Since this is a widely used and growing chain, the demand for this coin goes hand in hand.

SOL is also delegated to the validators to make the environment more stable and secure. Staking the coin guarantees decent returns, especially using platforms like Marinade Finance.

The maximum supply is infinite, but at the time of writing (November 2023) it is approximately 561 million units

The growth in recent years has been exponential: from 4 cents in April 2018, the coin reached $258 in November 2021... lucky early investors!
After the 2022 bear market, it suffered a significant price contraction, also thanks to the FTX/Alameda case, which can be counted among the main investors.
Despite this, development continues undaunted and 2023 was marked by recovery.

As always, everyone should do their own research.

All this makes SOL one of the cryptocurrencies worth keeping your eyes on and following.

 


 

Solana's strengths

Solana has several strengths that can be translated into these three concepts: security, scalability and decentralization.

What are the best possible applications?

In all honesty, there is no ideal environment for Solana: its numerous advantages make it suitable for very different environments.

However, the world of payments is perhaps the field where this chain could make the most of its potential:

  • The speed would guarantee an enormous amount of transactions per second;
  • Scalability would ensure the feasibility of expansions in the event of increasing diffusion;
  • Security would cover everyone's back, from companies to end users.

Yes, Solana would probably give his best in this area. Let's think of a credit card that uses its blockchain instead of traditional circuits (or perhaps that integrates, so as to offer more security and speed).

However, it doesn't stop there. Solana is also one of the most favorable environments in the world of gaming.

Over the years, games that offer microtransactions have increased dramatically. It is now common to find high-quality free titles, in which the developer company makes profits from the sale of items, transport, weapons, characters and additional levels. Any illustrious names? Fortnite, Rocket League, World of Tanks.

Solana lends itself very well to this reality, also taking advantage of the possibility of moving not only coins but also NFTs.

Very interesting projects are being developed, including the highly promising Star Atlas: an open world game set in space, created using the Unreal Engine graphics engine and which uses the Solana blockchain.

Although far from publication, this title already has a decidedly large and growing community of fans... to keep an eye on!

The applications of this chain are not finished: it is also well suited for the buying and selling of NFTs and for trading operations. In the next paragraph we will see some projects to focus on.

Solana is already a pillar of the crypto world. However, it seems that everything is still in its infancy: the potential is enormous and seems to suggest an absolutely leading future.

 

"Solana is a chain without limits and lends itself to numerous applications"

 

The most interesting projects on the Solana chain

Let's see together some platforms and projects to focus on.

Solana offers an environment full of opportunities. Some of them are of absolute quality and it would be a shame not to take advantage of them.

We have already talked about Star Atlas: let's save it for the future, especially if you are a gaming enthusiast.

Raydium is a very interesting DeFi protocol where you can easily earn your cryptocurrencies.
Furthermore, the abundant liquidity and the attentive team guarantee high security.
Also on this platform there is also the opportunity to buy and sell NFTs: the choice is rich and for all tastes!

Remaining in the world of digital art, mention should be made of Solanart and Solsea. These are widely used Non Fungible Tokens marketplaces and will probably see the number of users grow in the future.

Serum represents a fundamental element of the Solana world.
It is a DEX that integrates an order book that can be used by other DeFi platforms in the chain: in this way, Serum's liquidity becomes available to the protocol that uses it and vice versa. By doing so, the user benefits from better prices during the buying and selling phase and greater stability.

Marinade Finance is the DeFi protocol that offers more efficient staking. No more blocked funds: Marinade issues a synthetic token for each SOL staked, so as to be able to adopt a multi-level strategy that amplifies returns.

What about Sunny, Saber, Orca, Larix, Port and Atrix? DeFi projects that are very valid, safe and used by numerous users.

In the summer of 2021, the first on the list drove the community crazy thanks to the very high APRs given. Today Sunny has downsized a lot and is perhaps not the best choice for those wishing to invest in Solana's decentralized finance.

Saber is a pillar of the Solana ecosystem and is entirely dedicated to synthetic tokens: from Bitcoin to ETH, you can really find everything. The peculiarity of this protocol is that it offers liquidity pools between tokens anchored to the same asset, such as cSOL-cmSOL. By doing so, the risk of impermanent loss is eliminated.

Orca is Solana's user-friendly DEX: simple to use, it offers interesting tools and income.

Larix is a first-in-class metaverse-based DeFi protocol in this ecosystem. Capital is managed more efficiently and risks minimized.

Finally Port Finance, a well-known decentralized money maker of this blockchain. If the user needs to borrow coins (or provide them) here he will find what he is looking for.

Those just mentioned are just some of the excellent proposals of the Solana ecosystem. New protocols are constantly seeing the light: some interesting, others less so but still demonstrating a growing interest in this chain.

 

I progetti più interessanti su chain Solana

 

Solana: the definitive blockchain?

Solana is a blockchain that has a lot to offer in numerous areas.

It remedies the critical issues of Proof-of-Work and the centralization of Delegated Proof-of-Stake.

Furthermore, it is an open source project: anyone can view the code, study it and work on forks. Transparency is something fundamental, especially when our money is involved.

These aspects make Solana one of the best companies around.

So is this the final choice? We can't say: the users will decide it.

The opponents are certainly not watching. For example, Ethereum, which switched to the Proof-of-Stake algorithm, improving speed and lowering fees. However, Solana has its own characteristics and was not born as an Ethereum-killer: coexistence is possible.

Solana can therefore continue his fantastic journey without worrying about the other actors: the development achieved is such as to leave a certain margin of tranquility.

The growing adoption of blockchain and cryptocurrencies will do the rest: if everything goes as we think, the best projects will see a dramatic increase in users and collaborations with large companies and companies.

Solana will certainly be one of the protagonists in this process of change: being part of it will be definitely exciting!

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Negativeland
Negativeland

Interesting and fresh news on the world of cryptocurrencies. The articles are courtesy of Luca Boiardi of The Crypto Gateway

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