One of the most recent rivals to Ethereum, Solana, an open-source blockchain cryptocurrency, continues to storm the market in terms of its capabilities and advanced technology. Designed and created in 2017 by the Solana Group, the digital asset is currently worth around 106 USD.
Solana is quickly becoming one of the most used blockchain systems, but there is controversy over whether the digital currency is decentralised, a huge factor for those serious about crypto.
Investors and insiders hold a large share of the SOL tokens but, in time, and with more investment from outside sources, it’s expected that Solana will become less centralised.
For now, however, Solana continues to make gains in the market and here we’ll take a look at the reasons why.
1. Speed
Allowing a huge 65,000 transactions every second, compared to Bitcoin’s 4.6, Solana is tipped to be the crypto market’s equivalent of Visa. And with ever advancing blockchain technology, this is set to increase even further.
A huge part of this is down to the fact that Solana’s transactions are processed almost instantaneously, unlike many other cryptocurrencies that encompass a ‘holding’ area.
2. Low Fees
Solana have committed to keeping their costs incredibly low, assuring they’ll stay below $0.01 per transaction for all users. Meanwhile, Bitcoin’s transaction fees are currently around $2 but have previously been at a high of $28.6.
3. Trading Options
As with many other cryptocurrencies, there are options to trade Solana such as spread betting. SOL is also available to trade in pairs alongside currencies such as Bitcoin (BTC), Tether (USDT) and the US dollar (USD).
As the number of trading platforms offering SOL options increases, the more investors will be wanting to take advantage of this unique digital currency.
4. Proof-Of-History System
Solana has taken the previous proof-of-stake technology and incorporated it with their proof-of-history process, meaning there’s no longer a compromise needed to be made across speed, secure transactions and a decentralised system.
Unlike Bitcoin, Solana balances every aspect and therefore has become attractive to a wide market including investors, gamers and those trading NFTs.
Whilst some argue the nature of this system means the cryptocurrency is not fully decentralised, the more investment it attracts from individuals and companies outside of Solana, the less centralised it will become.
Using proof-of-history rather than proof-of-work also uses less power and electricity, meaning Solana is much more energy efficient than Bitcoin. This is likely to appeal to users and investors, particularly as there’s been much recent hype surrounding energy use and mining across the crypto market.
5. Large investors
A number of large and influential investors have got their hands on Solana, making it’s appeal even greater within the crypto market. This, in turn, is likely to attract more investors and developers.
Whilst there are always pros and cons to any new digital currency, Solana seem to have bridged the gap between many of the compromises faced by the likes of Ethereum and Bitcoin.
Only time will tell if it will overtake the market but, as it currently stands, it seems likely that Solana will continue to expand and make rapid gains.
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