Is Solana here to stay? • Not Just Hype • Benzinga Crypto

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Solana, a smart contract-enabled blockchain, reached record prices in 2021. The hype around the network and its SOL token is based on the fact that it has faster transaction time and lower fees than that of Ethereum, earning the nickname “the ETH killer”. Smartchain-enabled Layer 1s are all the rage, but tend to ride on Ethereum tailwinds. However, with a few key advantages over Ethereum and the growing adoption of the technology, Solana could be here for the long haul.

Is Solana here to stay or just a fad?

Solana was founded by Anatoly Yakovenko in 2017. The network was built by Solana Labs, an American software company. The Solana blockchain launched its SOL coin and raised funds from 2017, but it really started to catch the eye in 2021 when large sums of VC money started pouring into the project.

SOL’s total supply is around half a billion and uses a mix of Proof of Stake (PoS) as well as the less common Proof of History (PoH) consensus mechanism. This unique combination of network security gives the Solana network the low fees and fast transaction speed that the bulls are excited about. However, a major concern with Solana has been network instability, as well as susceptibility to hacks. Thus, the use of PoS and PoH has not yet proven itself as a reliable structure.

Solana’s story

The foundation of Solana was very different from that of Ethereum. While Ethereum was started by a ragtag group of independent developers and crypto enthusiasts, Solana was started by a company in San Francisco. This genesis was a big criticism of the project; with a key goal of crypto being decentralization, Solana is much more involved in the ways of doing business and Web2. Its centralization is revealed in the structure of the company, the low number of nodes exploiting the blockchain and the VC fundraisers.

Solana was launched in 2017, giving Ethereum a significant first-mover advantage. In the fast-paced crypto ecosystem, two years is a significant amount of time and is one of the main reasons why the number of ETH users, builders, and traders far exceed Solana. Solana holders received positive news when OpenSea – the largest NFT platform in the world – started accepting non-fungible SOL tokens (NFT) in April this year. This feature could increase demand for the token and further boost chain development.

Advantages and disadvantages of Solana

When considering the future of Solana, a number of differentiating factors come to mind. While SOL bulls may want to focus on the upsides, the downsides make it very difficult to scale the network and earn the trust of the crypto community as a whole.


  • Fast transaction speed
  • Low fees
  • Smart contract capability

The inconvenients:

  • Centralized (compared to other crypto networks)
  • Susceptible to hacks
  • Difficult to build

Solana Contest

Solana has intense competition; as stated earlier, it ranks well below the second largest cryptocurrency in the world – Ethereum. The competition does not end there, however. A seemingly endless number of similar smart-contract-enabled Layer 1 blockchains have been released. In particular the NEAR protocol, which is similar to Solana.

Perhaps the most threatening to Solana is the number of Ethereum Layer 2 projects in development, such as Arbitrum and Polygon. These layers 2 build on the basic infrastructure of Ethereum and provide cheaper and faster solutions. Layer 2s ultimately leverage the benefits of Ethereum (ease of use, decentralization, security) and enable faster transactions with lower fees.

How to make money with Solana

If you believe in Solana for the long term, one of the best ways to make money is to buy and hold the token. A good strategy to use is dollar cost averaging, where you set a specific weekly, bi-weekly, or monthly day to buy an amount of SOL. This strategy helps investors avoid buying the best and helps prevent emotional trading.

If you are looking to earn rewards on your SOL, you may consider interest staking. Using a cryptocurrency wallet such as Phantom, you can freeze SOL to help authenticate the Solana network. APYs vary for SOL staking, with smaller validators generally offering higher returns as there is more risk in these pools.

How to buy Solana


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Disclosure: eToro USA LLC; Investments are subject to market risk, including possible loss of principal.

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Solana is available on most trading platforms, including SoFi Technologies Inc. (NASDAQ: SOFI), Coinbase Global Inc. (NASDAQ: COIN) and eToro. The token is also easily tradeable on decentralized exchanges (DEX). Some popular DEXes to check out include SushiSwap, PancakeSwap, and UniSwap.

Is Solana here to stay?

It remains to be seen if Solana has the staying power; however, the recent adoption of Solana NFTs is great news for the community. The network is fast and inexpensive for users, but recent hacks and network issues have raised serious doubts about the project. For Solana to have a chance of staying, increased decentralization, network stabilization, and rapid adoption must take place.


Not all news on the site expresses the point of view of the site, but we transmit this news automatically and translate it through programmatic technology on the site and not from a human editor.
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