Three key points to buy Solana (SOL) or not:
- Thanks to an innovative PoH algorithm that has proved to be a real breakthrough in blockchain technology, it is incredibly scalable. For investors, this means they are unlikely to see congestion and the knock-on issues that Bitcoin and Ethereum suffer.
- The transaction costs are low, even when the network has billions of users, so don’t expect to get stung by a busy network.
- The blockchain is composable, which essentially means it offers flexibility when connecting to other projects and blockchains, making it an attractive partner for cryptocurrency developers to work with.
SOL, the cryptocurrency supporting Solana Labs, offers two use cases. The primary use is Proof-of-Stake, which allows users to stake their SOL on the network or an active validator service and receive rewards for doing so, making it an excellent long-term investment. The secondary use for SOL is to pay transaction fees or smart contract fees on the network.
Another reason investors want to buy SOL is because of the team running it. They have a solid foundation, their IP is protected, the development direction is clear and transparent, the code is open-source, developers are incentivized, and protocols are regularly updated. This is a high-quality project run by real experts, not an opportunistic venture that can line a few pockets.
What is Solana (SOL)?
Solana has been designed to offer a fast, secure, and censorship-free blockchain based on an open infrastructure model that works globally. It is supported by its native cryptocurrency, SOL, which started 2021 at just $1.80 and reached an all-time high of almost $56 in May.
Where to buy SOL in the US?
The best place for Americans to buy Solana (SOL) are:
Where to buy SOL in Europe?
Traders who want to buy Solana (SOL) in Europe have a better selection of exchanges to trade on:
- Huobi Global (3 trading pairs available)
- FTX (3 trading pairs available)
- Bitfinex (2 trading pairs available)
- Coinbase (5 trading pairs available)
How to Buy SOL
Choose one of the exchanges above, register and make an account, deposit fiat currency or a compatible cryptocurrency, and trade on a pair that features SOL. Each cryptocurrency exchange offers different pairs, with new ones being added quite frequently.
How Solana Works
Solana’s goal is to create a blockchain that not only allows for scalability but is wholly optimized for it. In that sense, as the network gets more extensive and more active, it will get more powerful, rather than slowing down, as commonly happens to its predecessors. Developers will also use Solana to create dApps, decentralized applications, without being held back by design flaws and network congestion. It works based on Yakovenko’s 2017 Proof-of-History algorithm that automatically orders the network transactions. Like many third generation blockchains that embrace DeFi, it will also offer a Proof-of-Stake consensus to secure the network. All of this is achieved with low transaction costs and great flexibility.
Solana started life at the back end of 2017 with a whitepaper offering a new timekeeping technique for distributed ledgers called Proof of History (PoH). This was the brainchild of Anatoly Yakovenko, Solana’s founder, who felt it is incredibly scalable. He solved the scalability issue that blockchains like Ethereum and Bitcoin continually suffer from. In addition, his solution tackled the transaction ordering process by offering an automated alternative.
Using this PoH theory, Yakovenko teamed up with Greg Fitzgerald, and they built a blockchain network called Rust. The first testnet was released in February 2018 with a new whitepaper. Another developer, Stephen Akridge, spotted an opportunity in the signature verification process to increase transaction throughput. The three teamed up and started Solana Labs, with the first development initially called Loom, but quickly changed to Solana because of a rival Loom Network.
In the spring of 2018, Solana Labs began its first funding campaign, raising over $20 million in coin sales. Development of the protocol continued for more than two decades, and in the autumn of 2020, its first testnet went live. Along the way, they raised millions more (including $4 million through CoinList) and also set up the Solana Foundation to create a sustainable way of funding ongoing development and community initiatives. In addition, the foundation encourages external developers to contribute to the project.
The distribution of SOL tokens has been very transparent, with the initial share looking like this:
- 15.86% to Seed Round investors
- 2.63 to Founding Sale investors
- 5.07% to Validator Sale investors
- 1.84% to Strategic Sale investors
- 1.6% to Public Auction Sale investors
- 12.5% to team members
- 12.5% to the Solana Foundation
- 38% to the Community reserve fund (managed by the Solana Foundation)