Is Solana "Sol" cryptocurrency a good investment?

There are over 7200 cryptocurrencies at the time of writing. Almost every single one of them claims to bring something unique to the table – something which no other cryptocurrency project has done before. Many of you will know that most cryptocurrency projects have either failed to deliver on their promises or never really had anything all that special about them to begin with.

Solana does not fall into this category. It is a cryptocurrency project with a radically different approach to how blockchains work. It focuses on an element which is so devilishly simple that it makes you wonder why you did not think of it: time. As it turns out, introducing a decentralized clock to a cryptocurrency blockchain makes it more efficient than anyone could have possibly imagined.

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A brief history of Solana

The story of Solana begins with a sunny California beach of the same name. Solana beach is located just 30 minutes north of San Diego, where (cryptocurrency project) Solana’s founder and CEO Anatoly Yakovenko has spent most of his life working in telecommunications. This is a bit of an understatement given that Yankovenko was instrumental in developing the technology found in all our smartphones during his 12 years at Qualcomm.

Yakovenko was initially not that interested in Bitcoin and Ethereum only slightly piqued his interests. He did however briefly mine Bitcoin while he was developing a deep learning computer network. During a self-described “caffeine induced fever dream at 4am” in 2017, he realized that Bitcoin’s hash function, SHA256, could be used to create a decentralized clock on a cryptocurrency blockchain.

Yakovenko theorized that timestamping transactions would exponentially increase the scalability of a cryptocurrency blockchain without sacrificing its security or decentralization. He knew it was possible to build since Google and Intel had both implemented similar technologies in their own databases, albeit in a centralized manner. Solana’s revolutionary whitepaper was quietly published in November 2017.

What is Solana?

Solana is a high-performance cryptocurrency blockchain which supports smart contracts and decentralized applications. It uses a proof of stake consensus mechanism with a low barrier to entry along with timestamped transactions to maximize efficiency.

This allows Solana to process 50-65 000 transactions per second with a theoretical limit of over 700 00 transactions per second (compared to Bitcoin’s 7 TPS and Ethereum’s 15 TPS). In contrast to other similar projects such as Polkadot and Ethereum 2.0 (once it is released), Solana is a single blockchain (layer 1) and does not delegate operations to other attached chains (layer 2).

The team at Solana has designed their blockchain with a long-term vision in mind. This comes from founder Anatoly Yakovenko’s own experience watching telecommunications technologies almost double in capability every year during his time at Qualcomm.

Solana is developed by a company of the same name which is based in San Diego, California. The Solana team consists of former Qualcomm, Google, Apple, Microsoft, and Dropbox employees. In addition to being based on similar database technologies used by Google and Microsoft, Solana’s architecture is also inspired by Filecoin, a decentralized data storage cryptocurrency project.