Most of us have heard about the basics of cryptocurrencies and know their premise and how they work. But, a lot of us are still unaware of the nuances associated with the ecosystem of cryptocurrencies. No matter how much we read or research, there are newer concepts and patterns originating each passing day that add to the complexity a little bit more. However, there are a few aspects of this field that do remain constant. While we come across new cryptos every day, some of them have made their mark in the current markets and are high in demand. Solana is one of them.
Understanding Solana – Solana can be understood as a blockchain platform that is designed to host some of the decentralized and scalable apps. It was founded in 2017 by the Solana labs based in San Francisco, it is now run by the Solana foundation in Geneva. The speed and number of transactions by Solana are known to be much faster than its competitors. Not only this, but it also provides another major advantage in terms of low transaction fees. The crypto associated with the Solana blockchain is SOL and has a market cap of more than 66 billion dollars. The foundation announced that there are a total of 489 million SOL tokens that would be released in circulation for trading. So far, 260 million coins have already made their way into the market. The Solana coin can be broken into fractions for purchase. Depending on the amount you are comfortable with, you can purchase that fraction of this coin to invest.
Advantages of Solana – SOL is known to be one of the biggest challengers to Ethereum. This coin did not get popular until last year when the prices surged and reached their all-time high. In Jan 2022, Solana became the fourth-most popular crypto that carried a huge market cap. Here are some of the major benefits that investors can receive from investing in this coin:
- Faster transactions – The network can handle a very large volume of transactions – as high as 50,000 per second. This is much higher than Ethereum, thus giving Solana a point over its competitor. The fees, also, are comparatively much lower and are a mere $0.00025.
- More traction – CoinSwitch, a crypto app India, has acknowledged that this coin seems to be generating a lot of traffic from new and old investors. Solana has more than 400 projects under the ecosystem with a noteworthy momentum. The massive amount of activity happening on the online markets along with the derivatives market has helped the network’s TVL increase by 15% over six months.
- Third-largest futures market – SOL is the proud owner of the third-largest futures open interest that is one of the highest and relevant metrics in the derivatives contract. The total number of contracts that are held on its network in lieu of the participants in the market regardless of its trading capacity is high.
- Institutional attraction- The market cap for this coin is significantly higher as compared to twice the value of Avalanche and Terra. In 2021, the sharp rise in the value and trading volume for this crypto is good proof of its growth and acceptance within further institutions.
- NFT and smart contracts – If there is one industry that has known to go as wild as cryptos, it would be NFTs. The insurmountable growth that this path has witnessed has led it to become a high-growth industry, especially after the epic sales that were hosted by renowned artists. Opting leverage from this, Solana jumped to grab the opportunity and is now gaining a huge market share with Solanart which is the NFT running on this network. It offers faster transaction speed and a lower transaction fee.
- Environment friendly – The reasons why Bitcoin and Ethereum are criticized is based on their negative impact on the environment. SOL, however, is carbon neutral. The computing power required to mine SOL is far lower than either of its challengers. The energy consumption is lesser making this greener, and therefore, a more desirable alternative.
These coins largely depend on a combination of Proof of Stake (POS) and Proof of History (POH) to improve scalability. It is also resistant to censorship and is secure in terms of transfers of money. Additionally, it offers much-needed flexibility imitating an open infrastructure that is needed for mass adoption.
Since August 2021, the Solana coins have seen a surge in the rate by at least 3,200%. The reason for this steep rise could be the investors eyeing the NFTs and DeFi platforms offered by Solana. You can use these coins for online payments, trading, investment opportunities, etc. The platform guarantees efficiency and privacy along with security for its users. You can register yourself on the online exchange platforms that offer their users a chance to trade in SOL. Invest now to be a part of the further growth of this coin. It is predicted to be one of the topmost coins in 2022 and is also expected to be a part of the mainstream economy as it is deemed to be accepted by institutions.