Ethereum’s unsolved problems have led to the emergence of interesting projects that are moving by leaps and bounds to resolve their predecessor’s mistakes. One such project, Solana, has seen its price increase by over 200% in August alone, putting it among the Top 8 cryptocurrencies by market capitalisation.
Smart contracts are becoming more popular because of the boom in the DeFi (decentralised finance) and NFT (non-fungible token) markets. Most projects use the Ethereum blockchain, which has been unable to cope with the workload. Network fees have risen again despite the London hard fork on 5 August to remove the network’s auction mechanism for transaction fees. We expressed our concerns at the start of the month, and, unfortunately, they have come true: costs have risen to highs last seen in February.
High expenses and low transaction throughput are forcing projects to search for alternative blockchains. Solana is one of the most promising; with an average transaction fee of $0.00025, its top transaction throughput can reach 50,000 transactions per second, which is thousands of times faster than Ethereum and Bitcoin’s blockchains. Several unique solutions make this possible, such as the blockchain’s use of a proof-of-history element that puts time markers on every block. As a result, a new block is created every 400 ms, while it takes 10–15 seconds with Ethereum. Meanwhile, it retains all the positive features of proof-of-stake, including passive income through staking.
Two weeks ago, Solana debuted on the NFT market with the launch of the Degenerate Ape Academy collection. In just 10 minutes, 10,000 monkeys were sold, and the coin’s price jumped 40%. Institutional investors have since expressed interest in the cryptocurrency’s success, leading to Osprey registering Solana Trust with the SEC.
Bill Noble, Token Metrics’ top analyst, believes that Solana can only be stopped if the cryptocurrency market crashes. Otherwise, the coin will soon reach $145.
The StormGain Analytical Group
