Solana, the hottest new blockchain, has strengthened its position further as it weathered the storm left behind by a Bitcoin crash Tuesday. Even though most large crypto tokens continue to trading in the red two days after the crash, the SOL token -- the cryptocurrency based on the Solana blockchain -- has managed to climb up.
The token clocked 20 percent gains over the past 24 hours, according to CoinGecko. It has surged over 90 percent in the past seven days.
Triggered by a dip in the prices of Bitcoin after El Salvador legalised crypto, the crypto market lost $180 billion in market value on Bitcoin Day.
Bitcoin's price dipped from around $52,000 to nearly $42,000 before it managed to recover half of the losses. Other tokens like Ether and Cardano didn't do any better and lost over 10 percent that day.
SOL, on the contrary, is a different story. Not only did the coin manage to trade in the green when top altcoins crashed, but it also continues to post gains. Except for a couple of hours on Wednesday when it turned red and posted losses.
The token's rapid rise in value and popularity is no fluke. The 6th most popular cryptocurrency has gone up by 430 percent in the past 30 days. A few months ago, the token was virtually unheard of and nowhere near the top 10.
What has made Solana so resilient is the fact that unlike Bitcoin, which only exists to store and trade some value through the token, the Solana blockchain is intended to be used for a host of projects. Around 400 projects of decentralised markets, NFTs, and other applications have already been built using the Solana blockchain, claims the project.
In this regard, it is similar to Ethereum than Bitcoin, the former being the world's most used blockchain for decentralised applications and other purposes.
The advantage that Solana holds over Ethereum is a new architecture that is capable of much faster speeds. The network claims to support 50,000 transactions per second (TPS), making it the fastest blockchain in the world. Bitcoin and Ethereum in comparison only clock in 5 TPS and 13 TPS, respectively. It is also the reason why Solana is called 'Ethereum killer'.
The system's proof of stake (PoS) system instead of the proof of work (PoW) mechanism also reduces the need for high power draws since miners aren't essential for the ecosystem.
Other features that the founders Anatoly Yakovenko, who previously worked at Qualcomm and Dropbox, and Greg Fitzgerald, who also worked at Qualcomm, have introduced are a proof of history (PoH) system, TowerBFT, mempool-less transaction forwarding protocol, a block propagation protocol, parallel smart contracts run-time and others.
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(Edited by : Yashi Gupta)
First Published: IST