Solana is a public, open-source blockchain that supports smart contracts, including non-fungible tokens (NFTs) and a variety of decentralized applications (dApps).
Native to Solana’s blockchain is the SOL token which provides network security through staking as well as a means of transferring value. Solana’s immense popularity as a blockchain comes from its super-fast transaction speed and low transaction costs.
As per their own information, Solana has a block time of 400 milliseconds and a transaction cost of $0.01 for both developers and users alike. Due to these unique factors, Solana is often praised for its highly scalable nature and is regarded as a direct competitor to Ethereum.
It was created in 2017 by Anatoly Yakovenko, based on a hybrid version of the Proof of Stake model called Proof of History.
Unlike the Proof of Work model, Solana uses the proof-of-history (PoH) protocol, which relies on validators rather than miners to process transactions and mint new cryptocurrency.
The proof-of-history method processes transactions in the blockchain network using timestamps submitted by many different validators. The protocol is a series of calculations that gives a digital record that certifies that an event occurred on the network at any point in time.
It may be provided as a cryptographic clock that offers a timestamp to every network transaction and a data structure that is a simple addition to it.
Unlike consensus in other blockchains, Solana nodes must vote on blocks and their transactions’ legitimacy in order for them to become part of the chain.
Nodes send votes to the leader and the leader is then responsible for tallying the votes themselves and signing off on the block. However, this method has sometimes led the blockchain community to criticize its decentralized nature.
Even with this criticism, Solana still remains highly popular as it can process as many as 50,000 TPS, with an average cost per transaction of $0.00025. In contrast, Ethereum can only handle less than 15 TPS, while transaction fees reached a record of $70 in 2021.