What is Solana?

Written by Pedro Lopez

July 7, 2022

Although Bitcoin and Ethereum have been the giants of the Crypto ecosystem, new projects have emerged in an attempt to improve what already exists. Solana is an exceptional example of this search for better scalability, so we will discuss what it is and how it works.

What is Solana?

Solana is a new blockchain project that wants to promote the development of decentralized applications (DAPPs) and for this it offers a platform that is the most scalable to date, secure and that tries to be as decentralized as possible. In addition, it plays in its favor that it has a system that does not need hardware or nodes, which avoids high energy consumption, something that does require bitcoin or ethereum. In other words, it bases its technology, on what is known in the crypto world, on the third-generation proof-of-stake consensus. In other words, it is a high-performance network that has come to improve the performance of previous blockchain networks.

When a blockchain transaction occurs, it needs to be verified by the nodes. In the case of Bitcoin and Ethereum it is ‘miners’ who do this work. However, the Solana network takes it a step further and seeks to do this in a more automated way, being able to endure many more transactions per second than other networks.

How does SOL work?

Regarding the Solana token (SOL), it must be said that it is designed to be a deflationary currency, which means that the number of tokens is reduced, growing its value.

This token is necessary to develop a project, to interact within the blockchain or generate smart contracts within it. Obviously, it can also be used as a payment method or as a digital asset, like Bitcoin or Ethereum.

Solana is a new blockchain network that comes to cover characteristics or improve the characteristics that did not have other networks. It offers more speed, lower energy consumption and smaller rates, since the price of Ethereum rates seriously limit users. In fact, this type of platforms that have come out to improve what Etehreum offered so far are usually known as ‘Ethereum Killers’ or Ethereum murderers because they are born to try to replace the network.

Should I buy SOL?

Many investors bet that the Solana network will house many projects in it, thanks to its sophisticated technology and that is why it will be necessary to buy sun. When we talk about investing in the Crypto Espacio, we have to be clear about the high risk we are assuming if we decide to buy the Token of Solana or any other. Although the technology is very advanced, it has large rivals in front of it such as Cardano or Ethereum, which continue to update as time goes by. Therefore, it is likely that in a few years all blockchain networks will not survive and only those that offer best performance are left.

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