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Solana (SOL) is one of the best-performing altcoins right now — so much so that it recently hit a brand new all-time high (ATH) of $130. While its price has dropped since hitting this record, sitting at $110 at the time of writing, the coin is still 50% higher than it was a week ago.
Solana’s impressive price performance even allowed its market cap to surge and win a spot in the top 10 largest cryptos, currently sitting at 8th place, as of September 1st, 2021. Today, we were interested in looking into what makes Solana so successful, as well as why this $130 milestone is likely not the last that SOL will achieve.
1. Speed and scalability
The first thing to note about Solana’s network is that it is extremely fast compared to any other project of this kind. Not only that, but it is also extremely scalable. This means that it can afford to process transactions as they arrive, which, in turn, ensures that there are no lengthy waiting periods, competition about which transactions will be processed first, which also means that there is no need for high fees — something that Ethereum’s network, for example, has become quite well-known for.
Solana claims that it can process at least 50,000 TPS, with each transaction costing only a cent. The project also says that, in time, its systems will improve enough for it to be able to process 700,000 TPS. Compare that to Ethereum that can only process 15-45 transactions per second, and its transaction fees surged so much that people actually started leaving.
2. It’s a good Ethereum alternative
Continuing from our last point — many have been looking for an alternative to Ethereum’s network, especially over the last year and a half, since DeFi and the NFT sector started going big. Ethereum revolutionized the crypto industry when it emerged, showing everyone that blockchain is a lot more than just a distributed ledger. However, its technical limitations have been a major issue, and while its developers are hoping to make it more scalable and capable, in general, with the launch of Ethereum 2.0 — there is likely only so much that an outdated system can achieve, even when revamped.
Solana’s network, on the other hand, was made with a more modern understanding of the crypto users’ needs and how to satisfy them, which is why it has grown to become one of the favorite alternatives for developers and users of various blockchain products. Of course, Ethereum is still the largest and the most innovative when it comes to said products, but many believe that it will be replaced in time, and Solana might be the project that will become the fabled Ethereum Killer.
3. Solana is entering the world of NFTs
We mentioned that Solana is going big with NFTs, and they are actually believed to be one of the major factors that influenced this recent price surge. NFTs, or non-fungible tokens, have been around for years, but only in 2021 did they explode into a major trend that they are now.
Through tokenization of artwork, various real-life and digital assets, and more, people are getting something new, interesting, and exciting. For the first time ever, collectibles are not only available but also affordable for everyone. They are easy to store, as well as display, and they can even allow users to earn money, depending on the value of the tokenized asset, and its potential for seeing price growth.
— 🧸🔫🐧Pentoshi Wont DM You (@Pentosh1) August 30, 2021
Solana entered the NFT market with Degenerate Apes, which is a collection of costumed apes that come with various traits, such as sandwiches, glasses, and alike. They come with various degrees of rarity, which is what is giving them value. The demand for pieces of this collection skyrocketed, and allegedly, 10,000 apes were sold out in less than 10 minutes. Hopefully, Solana will continue to see similar levels of success as it continues to delve deeper into NFTs.
4. Other products of its network are becoming successful, as well
Of course, while the NFT products have been very successful on Solana, they are hardly the only ones. Solana has started attracting projects and developers, and it is growing fast. Its network already has well over 400 projects, including DeFi projects, DEXes, stablecoins, dApps, and more, all of which is helping Solana look good for others looking for a reliable development platform to call home.
5. Building bridges
Another thing going for Solana is its wormhole project — which is its own name for bridges to different networks. Yes, Solana also dabbles in interoperability, which is another big trend in the crypto industry these days, as major projects are looking to connect to others and enable users to easily reach other coins and blockchain products.
Slowly but surely, the crypto industry, consisting of disconnected, isolated projects is becoming a network that will eventually grow into Web 3.0, and while the progress regarding this initiative has been slow — every little step counts, and Solana’s solution is one such step.
Solana is a rapidly advancing crypto/blockchain project, and one that has shown the potential equal to the likes of Cardano, and Ethereum in its time. It is far more capable than Ether’s network, and it seems to be developing faster than ADA’s, which is why it has been attracting users and developers alike.
Of course, no one can know with any certainty what awaits this or any other project in the future. The crypto industry is still very much uncertain, but from the developer’s point of view, Solana is one of the projects that are currently among the most promising. This is why a large part of the crypto community believes that it will be the next hit and that even its current all-time high can be re-conquered and bested with relative ease. To learn more you can also visit our Investing in Solana guide.