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SOLANA Blockchain Ecosystem
I feel:
“The blockchain economy will surpass all the barriers to free humanity from the bondage of ailing financial system ”
We are experiencing the new age of blockchain technology which is more powerful, more performant, and more scalable to support the vision of a decentralized world. Ethereum has been the torchbearer for a long time and has seen multiple Dapps, Defi systems, smart contracts being built over the top of it. But it has been struggling to support the increasing demand of those hosted apps due to its technological limitations, high network congestion & GAS fee.
Ethereum has decided to roll out its much anticipated Ethereum 2.0 version to overcome many challenges being faced in the recent past. While this Ethereum transition is yet to take its full shape there have been many competitor blockchain platforms that have risen to the occasion and have been innovating for scale.
One such blockchain platform which has hogged a lot of limelight recently is “Solana”. Today we will discuss
- What Is Solana?
- Why you should care about it?
- What is the underlying technology of how does it works?
- Use cases of Solana
- About SOL: Solana’s native token & Its Tokenomics
Let’s get started by defining,
What Is Solana All About?
As per the official Solana website:
Solana is a fast, secure, and censorship resistant blockchain providing the open infrastructure required for global adoption.
In short :
- It is the scalable decentralized ecosystem to build a Decentralized app
- It boasts of a maximum throughput of more than 50,000 TPS and block times as low as 400 ms.
- It was founded in 2017 Anatoly Yakovenko, during the ICO boom and went to MainNet in March 2020 it is still under beta release
Block times on Solana are nearly instantaneous, so anyone looking for speed to build crypto apps on the top of the Solana blockchain can benefit a lot from Solana’s novel architecture
How Does Solana Work?
One of the key reasons behind Solana’s robust speed and scale is the consensus mechanism it has adopted, which is the Proof-Of-Stake consensus algorithm to support transaction validation through staking.
Learn more about P.O.S below:
Proof Of Stake: Crypto Basics For All Part 2
What is Proof Of Stake In Blockchain?medium.com
Solana has built over the top of P.O.S a new consensus mechanism known as Tower Consensus.
Tower consensus is a variant of a system that enables distributed networks to reach consensus despite attacks from malicious nodes, known as Practical Byzantine Fault Tolerance (PBFT).
There are these 8 key innovative underlying tech innovations that actually help Solana fire all cylinders and function the way it boasts of.
Let’s get into each of those briefly
Proof Of History:
Solana (implementation of Practical Byzantine Fault Tolerance) enforces a global source of time across the blockchain through a novel protocol known as Proof of History (PoH).
The Proof of History is a Verifiable Delay Function, to hash all the incoming events and transactions sequentially that runs over itself continuously with the previous output used as the next input. Periodically the count and the current output are recorded. It uses the SHA256 hashing function which secures and impossible to parallelize without a brute force attack using ???? cores.
Thus, Solana via PoH keeps track of the past event which has elapsed between each counter as it was generated and that the recorded sequence of each counter of an event is the same as it was in real-time.
Solana’s specific implementation:
It uses a sequential hash that runs over itself continuously with the previous output used as the next input. With the computational output of the current function “X”, a validator will be able to calculate the output for the next function “Y”. Since the computation is universal, meaning all validators need to solve the same function “X”, and will be able to derive the output for the next function “Y” in around the same time,
Solana creates a synchronized “clock” across the whole network.
Tower (PBFT ) Consensus:
Tower consensus is a highly performant & reliable implementation of Practical Byzantine Fault Tolerance. It makes use of the PoH’s synchronized clock, to reduce the processing power needed to verify transactions since the timestamps of previous transactions no longer need to be computed, resulting in Solana achieving a high throughput performance-wise.
In a nutshell:
Tower BFT leverages Solana’s PoH as a clock before consensus to reduce messaging overhead and latency and evengtually achive liveliness of the events .
Apart from these two major technological innovation Solana rely on other 6 innovations which will cover in very brief as going too much into technical details is out of scope for the time being
Sealevel:
To compute multiple transactions in parallel. Solana makes use of the Sealevel feature which has the outstanding ability to process thousands of Smart Contracts parallelly and therefore helps in scaling Solana horizontally across GPUs and SSDs, which should help the platform scale to meet demands.
How Solana manages parallel transactions at scale?
This becomes possible, because, for all the parallel transactions, Solana is able to describe all the states transactions in consideration has to read and write while executing this not only allows for non-overlapping transactions to execute concurrently but also for transactions that are only reading the same state to execute concurrently as well.
Pipeline: Transaction Processing Unit
Apart from an innovative consensus mechanism, Solana makes use of a Pipeline comprising of various TPU components, which goes through multiple stages as shown in the fig above, this unit helps Solana to validate massive blocks of transactions and replicating them across the network in split seconds
In the Solana network, the pipeline mechanism progresses through
- Data Fetching at the kernel level
- Signature Verification at the GPU level
- Banking at the CPU level, and
- Writing at the kernel space.
Gulf Stream: Mempool-less transaction forwarding protocol
Solana also makes use of mempool -less system, inorder to forward the transactions to validators even before the previous pool of transactions is finalized, these help in scaling the transactions and enable concurrent processing of the same. This mechanism is known as ‘Gulf Stream’.
A mempool is a set of transactions that have been submitted but have not yet been processed by the network.
Solana validators can manage a mempool size of 100,000. That means that with network throughput of 50,000 TPS, a 100,000 transaction mempool is executed in a matter of seconds. That’s what makes Solana the most performant permissionless blockchain in the world.
For more details on other innovations please visit:
Developers: Resources and Information for Building on Solana
Learn why Solana is used by the best and brightest teams in crypto. Explore our guides and examples to start building…solana.com
Solana Use Cases:
Some of the popular, Defi , DApps, NFT, etc.. are already leveraging the power of the Solana blockchain ecosystem to built their tech stack
Few Popular Examples:
- Solarians: are the first generative NFT built on top of Solana
- Audius: one of the most popular music streaming platforms that puts the power back into the hands of content creators.
- Tether: USDT is the largest stablecoin by market capitalization and is one of the most widely used stablecoins in the Defi sector, has announced to migrate on Solana blockchain.
An there are hundreds of other crypto projects already active on Solana's blockchain ecosystem, refer to the image below to get the gist of the Solana power.
Solana’s SOL Token & It’s Tokenomics:
Solana’s has a native gas token named ‘SOL’, which is consumed to facilitate smart contract operations and other transactions happening in its network. Solana was officially launched in March 2020 by the Solana Foundation with headquarters in Geneva, Switzerland.
Solana Tokenomics:
- Coin Circulation:
The Solana Foundation announced that in total 489 million SOL tokens will be in circulation. Almost 260 million of these have already entered the market.
- Market Stats:
At the time of writing, As per coinmarketplace,
Below are a few market stats:
SOL ranks 13 currently on the basis of market cap and has been trading at $35 at the time of writing, it touched the ATH of $55.91 on May 18th, 2021, and retraced to almost 50% in the recent market crash, but has been recovering well currently and still trading below it ATH.
SOL Token Distribution:
The SOL coin distribution is as follows:
- Seed Sale tokens comprise 16.23% of the total token supply.
- Founding Sale tokens comprise 12.92% of the total token supply.
- Validator Sale tokens comprise 5.18% of the total token supply.
- Strategic Sale tokens comprise 1.88% of the total token supply.
- CoinList Auction Sale tokens comprise 1.64% of the total token supply.
- Team tokens comprise 12.79% of the total token supply.
- Foundation tokens comprise 10.46% of the total token supply.
- Community tokens comprise 38.89% of the total token supply.
Release Schedule Timeline Of SOL token:
Image credit: Binance research
Progress So Far Since Its MainNet Launch:
Here are some high-level stats since Mainnet Beta launch earlier in the year:
- Over 100 project integrations spanning Defi, Blockchain Gaming, and Web3 verticals
- 350+ active validators distributed across the globe
- 8.3 billion transactions on-chain and counting
- Over 54 million blocks have been created
- 4.9 million unique SOL wallets
- 600,000+ global advocates and community members
- The Solana Foundation hosted its first hackathon in Q4 and over 1,000 devs participated in the event
Summary:
The Solana ecosystem is growing swiftly and has fired more than 8 billion confirmed transactions so far from the hosted apps built on top of it, but still, I feel it is in a very early stage and will have a lot of ground to cover, especially to outcompete Ethereum which has already proven itself having largest DeFI, DApps, and Smart contract ecosystem for thousands of app which is already live on it.
Having said that, due to its solid technology & rock-solid team, Solana is all poised to challenge all the competing blockchain platforms like Ethereum 2.0(yet to be rolled out in its full shape), PolkaDot, Cardano, BINANCE smart chain, Polygon, etc and would play a crucial role in balancing the act for fair gameplay in the crypto universe.
The SOL token has performed well since its launch and has given more than 4500% returns to date, It has shown strong resilience even in the current market crash and has bounced back well, but I feel it will have multiple small fallbacks before it goes on to touch the magical figure of $50-$70, which looks possible before 2021 ends. It all boils down to how speedily it comes out from its beta phase and how innovative they are in building the community around their ecosystem.
Disclaimer!
Opinions expressed here at CryptoWise are not investment advice and are only for educational purposes. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency, or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility
Note!
This article was first published on Medium, here is the link:
https://medium.com/crypto-wisdom/solana-all-about-solana-blockchain-sol-token-you-ever-wanted-to-know-88933a5fa234
