What is Solana?

By | October 24, 2022
Solana Cryptocurrency

Solana Cryptocurrency

Solana is a blockchain network that upholds SOL cryptocurrency. It is known for its fast transactions and low transaction processing costs. Its rival blockchain is Ethereum. Unlike Ethereum, it can handle 3,400 transactions per second while Ethereum can only do 15 transactions per second, making it one of the fastest blockchains in the world. Solana uses Poh, which uses hashed timestamps to verify the history of the transactions that occur.

Uses for Solana

If you have a cryptocurrency wallet, Solana is great for sending or receiving money to transfer to exchange for goods and services. Availability for Solana is popular among many people because it is known primarily for its low costs. Examples of what Solana is used for can be for things such as NFT transactions, decentralized finance apps (Runs on P2P blockchain network rather than on one computer), and smart contracts.

How to get started with Solana

To get started using Solana you first need to know what cryptocurrency is. Crypto is a digital currency that is an alternative form of payment using encryption algorithms. This means that cryptocurrencies function both as digital currency and a virtual accounting system. A crypto wallet stores private keys, which keeps your crypto safe and accessible. This is when using Solana comes into play. Unlike a traditional wallet to store cash, online wallets use some sort of software or app that is protected by a two-step encryption to make sending, receiving, and using your crypto easy.

You can buy and sell Solana on Coinbase.

Negatives of Solana

Although Solana is outrunning its current competitor, it has its downsides as well. The Solana Network is not unlimited. If it becomes overly centralized and one group or entity gains control over a large share of the SOL token supply. Compared to Ethereum, Solana has a smaller community of users and a short track record. This network is not as reliable in terms of stability. Reliability is a key factor for cryptocurrency investors, so this is not the first algorithm that these investors will use. In order to truly outrun Ethereum, they need more active projects and validators. Validators are computers dedicated to maintain a blockchains integrity.

One positive about Sol.x is that it can be Staked and you can earn rewards, here’s how.

Benefits of Ethereum

Ethereum has a much wider margin of users compared to Solana. The market cap for Ethereum is $210 billion dollars, while Solana’s market cap is $12 billion dollars. It is also the second largest cryptocurrency in the whole world. Ethereum has a way higher trading volume is more well known and used in the crypto trading market. It is known for aiding in the creation of different types of smart contracts. It is also the go-to blockchain for NFT’s. Ethereum is planning to get upgraded, and can increase transaction speeds to as much as 100,000 transactions per second. This will put Ethereum back in the lead and beat Solana’s maximum number of transactions, which is 3,400 transactions per second. The difference is 96,600 more transactions, which can be the make or break of Ethereum taking back its spot as the most used and overall best blockchain network in the world.

Learn more about Solana on Coin Market Cap.