Solana — history, principles, prospects

02.06.2022 |

For article about Solana

Despite the relative youth of the project, Solana has already become one of the leaders in a number of areas. For example, already today, about a billion dollars of distributed finance funds are blocked in the cryptocurrency ecosystem. Although the developers still consider SOL to be in test mode, however, this does not reduce interest in the project. Let’s look at what the main ideologists have proposed and how they implement their promises.

The history of Solana

The direct launch of the Solana project in 2018 was handled by Anatoly Yakovlenko, a programmer from Qualcomm and Dropbox, Eric Williams, PhD, and Greg Fitzgerald, who worked at OC BTEW at that time. At the same time, in addition to those already announced, the creators of the project worked in companies such as Intel, Microsoft, Twitter and a number of other IT market leaders. Solana itself was founded in 2017 in San Francisco, and in the same year the white paper of the project was published. At the same time, two years have passed from the launch of the test network to the beta version, and the project is still at the last stage.

Thanks to the big names of the companies in which the founders of the project worked, Solana managed to attract more than $300 million of investments in several rounds. The jurisdiction of registration of the company itself also played an important role. Investment companies tend to trust projects from the United States as transparent and understandable due to the peculiarities of the legal field and protection.

Solana Operating Principles

To ensure consensus, the project developers decided to use not an energy-intensive Proof of Work, but a more environmentally friendly Proof of Stake. Although this approach is criticized, in particular because of the greater possibility of centralization and the potential seizure of control by a small group of wealthy investors, but there are also advantages here, which you can read more about at the link above.

In addition to the consensus algorithm, the developers have implemented a new approach to synchronizing full nodes, called Proof of History. It should be understood that PoH is designed to increase network throughput by reducing the time of block creation and optimizing their reproduction.

Also from the technical features can be distinguished:

  • Tower BFT is a cryptographic clock that helps to achieve consensus without sending messages between nodes.
  • Gulf Stream is a solution to reduce the size of the pool of unconfirmed transactions, due to which it was possible to achieve transaction processing speeds of up to 50,000 per second.
  • Turbine is a basic solution, due to which the throughput speed is increased, the transmitted information is packed into smaller blocks, which are transmitted between nodes.
  • Sealevel — simultaneous processing of multiple transactions.
  • Pipelining is an optimizer of data entering the network, which increases throughput.
  • Cloudbreak is a tool for working with a distributed registry, which, in particular, is optimized for modern SSD drives.
  • Archivers is a blockchain repository, while the so—called archivers only support data storage without participating in consensus building.

SOL — Solana native token

Similarly to ERC-20 in Ethereum, Solana decided to use an SPL token called SOL for the native currency. With the help of this currency, the project is managed and commissions are paid, as well as wallets with a sufficient balance participate in reaching consensus.

To maintain the value of SOL, developers periodically burn a certain number of coins, thus forming a deficit and a deflationary model. At the same time, in addition to the deficit, the foundation and background of developers allows you to get a fairly high degree of trust, which attracts many investors and creators of distributed finance protocols.

Criticism of the project

A little higher, we showed what prospects the project can expect, but Solano has enough criticism.

Although many founders have chosen this blockchain for their decentralized finance projects, only so far the distributed registry has not been released into production, remaining in beta testing. In fairness, bitcoin has been in a similar situation for more than five years and, in fact, switched to a stable version only conditionally, changing the rules for naming versions.

There were also two failures in Solana, last year and this year. At the same time, in 2020, the network did not work for more than six hours. Also, not everyone is inclined to be optimistic about the scalability approach, considering it quite complex, and its effectiveness will be proven only by time.