What is Solana
Solana is a blockchain platform designed for decentralized, scalable applications. Founded by Anatoly Yakovenko in 2020, Solana is an open-source project currently run by a Geneva-based foundation, and the blockchain itself was built by Solana Labs.
Solana is billed as one of the fastest blockchains in the world and the fastest growing ecosystem in cryptocurrency, with thousands of projects spanning DeFi, NFT, Web3 and more.
The network itself is governed by a proof-of-stake (PoS) consensus mechanism as well as a proof-of-history (PoH) mechanism. The Solana network focuses on high transaction throughput and short processing times – the network can supposedly process around 50,000 transactions per second.
“Ethereum Killer”
Solana is a rapidly growing blockchain with striking similarities to Ethereum – often referred to as the “Ethereum Killer”.
Like Ethereum, the SOL token can be purchased on most major exchanges. The true value of the token lies in transacting on the Solana network, which has unique advantages.
Solana’s blockchain uses a proof-of-history (PoH) consensus mechanism. This algorithm uses timestamps to determine the next block in the Solana chain.
Most early cryptocurrencies, such as Bitcoin and Litetcoin, used a proof-of-work algorithm to determine the blocks in their chains. Proof of work uses a consensus mechanism that relies on miners to determine what the next block will be.
However, this proof-of-work system is slow and resource intensive, resulting in the use of huge amounts of energy. This is one of the reasons why Ethereum migrated to PoS.
Driven by its unique combination of proof-of-story and so-called delegated DPoS proof-of-stake algorithms, the main problem Solana was trying to solve was Ethereum’s scalability issues. Delegated proof of stake is a variation of the more traditional algorithm. For those in need of a refresh, the proof-of-stake mechanism is a transaction process for creating new blocks on a blockchain using a system of validators.
What kind of problems does Solana solve?
Essentially, Solana solves two of the three problems identified by Ethereum co-founder Vitalik Buterin in his blockchain trilemma of scalability, security and decentralisation.
Although Buterin initially claimed that Ethereum would address all three aspects of this trilemma, most experts believe that the network only addresses two factors: security and decentralization. Solana, however, is designed to address two parts of the trilemma: security and scalability. Solana’s proof-of-story algorithm provides unique security for the network. While the speed at which the Solana platform performs computations allows for increased scalability.
Like most of the world’s largest cryptocurrencies, SOL tokens can be traded on any number of platforms. This includes centralized exchanges like Binance.US, Coinbase, and Kraken, to name a few. In some cities around the world, SOL tokens are even available in cryptocurrency vending machines (cryptomats).
After purchasing SOL tokens, investors will want to store the SOL tokens in a crypto wallet after purchasing them. Unlike the name, crypto wallets are not where the cryptocurrencies themselves are stored. Rather, they are where owners store the keys to their cryptocurrencies. These wallets can be stored either online or offline. (The safest storage option is offline with a cold wallet.)
Yakovenko’s previous professional experience has been in distributed systems design with leading technology companies such as Qualcomm Incorporated (QCOM). This experience made him realize that a reliable clock simplifies network synchronization, and when this happens, the resulting network will be exponentially faster, with the only limitation being its bandwidth.
Yakovenko’s innovative idea
Yakovenko suggested that the use of proof-of-story would speed up blockchain immensely compared to clockless blockchain systems, such as Bitcoin and Ethereum, which struggle to exceed 15 transactions per second (TPS) globally, a fraction of the bandwidth handled by centralized payment systems, such as Visa Inc.’s (V), which peak at 65,000 TPS.
Yakovenko’s initial implementation began in a private database and the C programming language. At the behest of his former Qualcomm colleague Greg Fitzgerald, Yakovenko subsequently ported the entire codebase to the Rust programming language.
In February 2018, Fitzgerald began prototyping the first open-source implementation of Yakovenko’s white paper and subsequently made the project’s first release, demonstrating that 10,000 signed transactions could be verified and processed in just over half a second. Soon after, Stephen Akridge – another colleague of Yakovenko’s at Qualcomm – demonstrated that performance could be significantly improved by offloading signature verification onto GPUs.
How to buy Solana?
1. Choose a crypto exchange
There are numerous cryptocurrency exchanges and marketplaces that range from easy-to-use systems to complex dashboards for advanced traders.
Because Solana is so popular, you’ll be able to purchase the token on most cryptocurrency exchanges, but it’s advisable to stick to a few of the more popular exchanges like Binance, Kraken, Coinbase, etc. Different platforms come with different fees, security measures, and may include other features, so it’s a good idea to do your research before signing up.
2. Create an account and confirm it
Start with account registration, which is completely free on the above platforms. For added security, 2FA – two-factor authentication is also enabled. This way, you and your device are the only ones who can grant access to the account.
You are then taken through a KYC process, which is providing personal information – ID card/passport/driving license details, proof of address (e.g. bank statement or utility bill).
After completing these steps, you are ready to buy, sell and trade Solana (SOL), as well as take advantage of various services such as steaming.
3. Fund your account
Once your account has been registered and verified, you need to fund the account to start taking advantage of the platform’s buying and trading services.
The main deposit options are:
- Credit/Debit Card
- Bank deposit
- Peer-to-peer (P2P)
Where to buy Solana?
On Binance, the world’s largest cryptocurrency exchange, deposits are absolutely free.
