Solana (SOL) is one of the world’s most promising cryptocurrencies, prized for its impressive speed and low transaction costs. This open-source project, officially launched in 2020, uses blockchain technology to support decentralized finance (DeFi) solutions and building scalable crypto applications. In this article, we explore what Solana is, its features and its impact in the cryptocurrency ecosystem.
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Ce este Solana si cum functioneaza Proof of History (PoH)
Solana is a blockchain platform created to improve scalability and provide an efficient alternative for fast and secure transactions. Unlike other projects, Solana introduces an innovative concept called Proof of History (PoH), which works in combination with the Proof of Stake (PoS) consensus mechanism. These technologies allow Solana to process an impressive 65,000 transactions per second at an average cost of just 0.000005 SOL per transaction.
What is Solana – Solana Ecosystem
The Solana ecosystem has seen unprecedented growth in recent years, becoming one of the most active and innovative in the industry.
Popular aspects of the Solana ecosystem include:
- Decentralized Finance (DeFi): Financial applications built on Solana allow users to borrow, lend or trade without an intermediary.
- NFTs: More and more digital artists and collectors are turning to Solana because of its low fees and speed of transactions.
- Blockchain-based gaming: Games like Star Atlas use Solana to create scalable and immersive user experiences.
If you’ve wondered what Solana is and why it attracts both active investors and dedicated developers, you should know that it is considered one of the most promising blockchain platforms.
What is Proof of History (PoH)
One of the most remarkable aspects of Solana is the use of Proof of History (PoH), an innovative technology that revolutionizes the way transactions are validated. In most blockchains, the order of transactions is established by consensus, which requires communication between nodes in the network. This process consumes time and limits the speed of transactions. Proof of History (PoH) is a key innovation that differentiates Solana from other blockchains.
What is Proof of History?
Proof of History is a unique validation method that uses a cryptographic clock to put each transaction in a clear chronological order. This eliminates the need for traditional consensus which can slow down processing speed.
What Proof of History does:
- PoH creates a verifiable record of the passage of time. This is achieved by using a verifiable delay function (VDF).
- In essence, PoH creates a “cryptographic clock” that records the order and time of transactions.
- This cryptographic clock is realized by a continuous sequence of hashes. The result of one hash is used as input for the next hash. This process is sequential and requires a single core to be realized.
- Solana’s validators can use this time recording to determine the order of transactions without having to constantly communicate with each other.
Why is it important?
By utilizing Proof of History, Solana can process multiple transactions simultaneously without compromising security or efficiency. Under optimal conditions, the network can handle over 65,000 transactions per second, an impressive figure for the blockchain world.
This scalability makes Solana the ideal solution for decentralized applications (dApps) and projects that require a high volume of transactions.
How Proof of History (PoH) works in combination with Proof of Stake (PoS):
- Solana uses PoH in combination with PoS.
- PoS is used to select validators that will produce blocks.
- PoH is used to ensure the order of transactions in each block.
In conclusion, Proof of History is an innovation that enables Solana to achieve remarkable speed and scalability, making it an attractive platform for a variety of decentralized applications.
Solana: Technological innovations
Having explored how Proof of History revolutionizes transaction chronology, let’s delve into the other Solana innovations that contribute to this blockchain’s remarkable performance.
What is Tower BFT?
Tower BFT (Byzantine Fault Tolerance) is Solana’s custom implementation of practical Byzantine Fault Tolerance (pBFT), which allows the network to synchronize quickly and efficiently, reducing latency and improving security. Basically, Tower BFT uses timed clocks for validation, saving time and energy in confirming transactions.
Key benefits of Tower BFT:
- Quick transaction confirmations.
- Efficient consensus without huge energy consumption.
Pipeline – Efficient transaction processing
The Solana pipeline functions as a web-scale transaction processing unit. Basically, it separates complex tasks into small steps that are processed simultaneously and continuously in different parts of the network. This optimized method allows Solana to handle huge volumes of data while maintaining minimal latency and high efficiency.
Why is it important?
- Pipeline can process up to 65,000 transactions per second (still impressive in the context of blockchain).
- Reduce network congestion while keeping transaction fees low.
Turbines – Efficient data block propagation
The Turbine protocol solves one of the biggest challenges in blockchain: efficiently propagating blocks of data. Turbine is inspired by peer-to-peer network protocols and fragments information into smaller packets for fast and easy transmission over the network.
Through this mechanism:
- Increase the speed of block allocation.
- It reduces bandwidth consumption.
Cloudbreak – Horizontal scaling
Another unique element of Solana is Cloudbreak, a database specifically designed to manage millions of accounts simultaneously. Unlike other blockchain systems where databases are one-dimensional, Cloudbreak is able to scale horizontally, supporting massive transactions without compromising performance.
How does Cloudbreak work?
Cloudbreak is based on three innovative components:
- Memory-Mapped Storage: This system allows fast access to data directly from disk without overloading RAM. Basically, it helps the network handle large volumes of transactions without significant delays.
- Sequential Operations: Cloudbreak prioritizes sequential operations to minimize the conflict between reading and writing data. This process optimizes the processing flow.
- Garbage Collection: the system automatically cleans redundant or obsolete data to maximize available space and reduce storage costs.
Major advantages of Cloudbreak:
- Manage data simultaneously without increasing processing time.
- Optimize the hardware resources involved.
To better understand Cloudbreak, Solana’s new solution for horizontal scaling, click here.
Gulf Stream – Mempool-free trading protocol
Gulf Stream eliminates what other blockchains call the “mempool” (the area where transactions wait to be validated). Instead of storing transactions, Gulf Stream routes them in advance to the validators responsible for the next block.
What does this mean?
- Reduced transaction confirmation time.
- Respond faster to market changes.
- Optimizes network flow to reduce pressure on validators.
Archivers – The blockchain data storage solution
One of the big challenges blockchains face is efficiently storing large volumes of historical data. Solana introduces Archivers, a decentralized solution where nodes in the network store fragmented parts of the blockchain.
How it works:
- Validators outsource storage to Archivers.
- Archivers don’t require expensive nodes and can run on ordinary hardware.
This reduces the cost for network users while remaining scalable and decentralized.
Sealevel runtime for parallel processing of smart contracts
Smart contracts are at the “heart” of many blockchain projects, and Solana has created an execution system called Sealevel, which allows multiple smart contracts to run simultaneously.
What is Sealevel runtime?
It is an innovative mechanism that allows parallel processing of multiple contracts. Instead of executing contracts one by one, sealevel processes multiple contracts at the same time, eliminating bottlenecks.
How does this help?
The improved performance allows developers to create more complex applications such as blockchain-based games, dynamic NFT marketplaces, and decentralized financial platforms (DeFi). This unique technology makes Solana perfect for companies and projects that require scalability and high performance.
The seven innovations listed above – Tower BFT, Pipeline, Turbine, Cloudbreak, Gulf Stream, Archivers and Sealevel – are the cornerstones that make Solana one of the most powerful and efficient blockchains available.
Caracteristici cheie ale blockchain-ului Solana
If you’re a crypto investor looking for a scalable, fast and low-cost platform, Solana could be exactly what you need. Next, we’ll show what the key features of the Solana blockchain are:
Block time less than one second
What is block time
According to Chainspect, block time is the time interval between the creation of successive blocks in a blockchain. It is essentially the frequency with which new blocks are added to the blockchain. This metric is measured in seconds or minutes. Block time determines the speed at which transactions are confirmed and therefore influences the transaction per second (TPS) rate. A shorter block time means faster transaction confirmation. For example, Bitcoin has a block time of about 10 minutes, while Ethereum’s block time is about 13 seconds, leading to faster transaction confirmations on Ethereum.
In the world of financial transactions, every second counts. Solana impresses with a block time of less than one second, which delivers almost immediate transactions.
Benefits of fast transactions
- More efficient payments, which means a better user experience.
- Improve the performance of dApps applications, especially for gaming or NFT markets where speed is critical.
For example, Ethereum has longer lock times (around 10-15 seconds), which can lead to delays and higher costs. Solana eliminates these hurdles.
Low transaction costs
Another aspect that attracts investors to Solana is that the trading fees are extremely low. On average, a trade on Solana costs you less than 0.000005 SOL. Yes, you read that right!
Low costs facilitate frequent and affordable transactions. Almost anyone can participate in the network without the burden of exorbitant fees. For crypto investors this matters because the savings from each transaction add up and help maximize profits.
Istoria si dezvoltarea Solana
When wondering what Solana is, we also need to know its relatively short but eventful history. Solana has its roots in the vision of a former Qualcomm engineer, Anatoly Yakovenko. In 2017, Yakovenko identified one of the biggest challenges of existing blockchains – scalability issues. He set out to create a network that could offer fast transactions without compromising security or decentralization.
Key to this project was the development of an innovative mechanism called Proof of History (PoH). This algorithm allows for the temporary tagging of blocks, making the consensus process much more efficient. Despite the complex technical issues involved in creating a new blockchain, Yakovenko was supported by a talented team, including names such as:
- Greg Fitzgerald – co-founder and principal engineer;
- Stephen Akridge – who helped optimize the validation process;
- Raj Gokal – who was in charge of business and growth.
This team officially started developing Solana in 2017, laying the foundations of a network that would go on to dominate the blockchain industry.
In March 2020, the Solana network and its native token, SOL, were officially launched.
From the very beginning, Solana has impressed the crypto world with its outstanding performance:
- It could process more than 65,000 transactions per second (TPS), far outpacing other famous blockchains such as Ethereum or Bitcoin.
- Transaction fees were much lower, a major advantage for users.
In just a few months, Solana has seen rapid growth, attracting an increasing number of developers and projects into its ecosystem.
In 2021, Solana became one of the most popular blockchains used for DeFi (decentralized finance) and NFT (non-fungible tokens) projects. Its ecosystem now includes thousands of decentralized applications (dApps), projects and NFT marketplaces.
To better understand what Solana is and what the objectives of this project are, we recommend you to read the Solana whitepaper.
Market conditions and the Solana value
There is no maximum supply of SOL tokens, i.e. a predetermined limit to the total number of SOL coins that will ever exist. Instead of a maximum supply, Solana uses an inflation model, which means that new SOL coins are continuously created at a certain annual rate. Under Solana’s proposed inflation program, the initial rate of inflation has been set at 8% and is distributed through staking rewards.
Currently the SOL value is around 124.80USD.In circulation we have a total of 509,411,887 coins.
Here are the historical lows and highs of SOL (Solana) price
All-time high: around 296 USD (January 2025). The launch of Donald Trump’s memecoin on Solana has generated a flurry of interest and trading, propelling the SOL price to a new all-time high in January 2025.
Historic low: around $0.50 (May 2020).
Market cap and volatility Solana
For crypto investors, a coin’s market cap provides insights into its size, stability and market performance. Solana ranks 6th in the global cryptocurrency rankings, with a current market cap of about $63 billion.
Key figures:
- Fully Diluted Market Cap (FDV): $73.8 billion. This is the amount Solana can reach if all supply becomes available.
- 24h trading volumes (source: Coingeko): Users around the world trade Solana at a volume of around USD 3 billion a day, indicating a growing interest in the cryptocurrency.
These figures underline that Solana remains a significant investment in the crypto market, but like all cryptocurrencies, the price is volatile and can react to global news and events.
- What’s next for Solana?
With a unique architecture, impressive processing power and an expanding ecosystem, Solana is a market leader in the cryptocurrency world.
Important things to remember:
- Solana is fast, secure and scalable, making it ideal for crypto transactions and developers.
- Proof of History technology makes it unique in the blockchain world.
- The community and ecosystem around Solana are growing.
Investors interested in long-term projects should follow Solana closely. With strong leadership and a clear roadmap, the future of this blockchain looks promising.
If you want to learn more about cryptocurrencies, you can find a range of articles and educational materials on the Abarai blog. We recommend you to read: