With days passing by, the cryptocurrency world is becoming an exciting hub. Plenty of new blockchain networking platforms are emerging here with promising features that will help crypto users enjoy an experience like never before. The Solana blockchain network is one of them.
The Solana blockchain is a unique platform that offers users a relatively fast transactional experience at quite a low cost, unlike the other major crypto platforms. And the mystery behind that is its innovative way of using the blockchain mechanism. Solana’s blockchain network is the first of its kind that introduced the unique “proof of history” mechanism and utilized its application successfully to run the blockchain system.
However, to know what is solana coin and how this unconventional method works, first, we must know what Solana (SOL) is. Here’s a thorough description of the subject matter that will help gain a broad perspective regarding the Solana blockchain network and open new opportunities for investing in high-returning stakes.
What Is Solana (SOL)?
Solana (SOL) is the first ever invented blockchain network that runs using the “proof of history” mechanism. Like all the other cryptocurrency blockchain platforms like Bitcoin and Ethereum, Solana is also a rapidly growing crypto blockchain network in the digital currency world.
The network’s popularity helped it reach one of the top positions in the crypto marketplace and gain a value of nearly 200 USD after its initial launch. This significantly triggered its demand, and now one can find Solana coins in the most prominent crypto exchanges. If you are unknown about what is solana coin, then you should know that the native token or coin of the Solana network is called Solana coin or, in short, SOL.
What Is The History Of Solana?
The name of the crypto platform, Solana, is originally derived from a coastal area of California, and “Anatoly Yakovenko” was behind the concept of the Solana network. Although the first Solana network block was brought in the year 2020, the project and its basic conception were published publicly in the year 2017 in a whitepaper.
Unlike other major cryptocurrency blockchain networks, the Solana network utilizes the “proof of history” mechanism. One of the primary reasons behind investing in such a network that goes by the “timekeeping” or “clock” system was the “scalability” problems faced in well-known crypto platforms like Ethereum or Bitcoin.
Solana’s blockchain is based on a concept that is popularly addressed as the “crypto clock.” Via this consensus mechanism, the nodes of Solana’s blockchain maintain and keep the records of each passage of time and encrypt it into an algorithm of hashing (SHA-256).
After Solana got introduced into the market, its price was initially at a low level, around 1 USD for each coin, but with the passing of time and its user-friendly crypto features made it one of the preferred platforms among investors for trading and staking and increased its price value currently up to 35 USD each coin.
What Does Solana Do?
Now, before discussing what Solana does or how does Solana work, one first needs to understand that the Solana blockchain uses the unique “proof of history” mechanism rather than a “proof of work” or “proof of stake” consensus mechanism. The proof of history mechanism helps the blockchain to maintain the time of occurrence of an event or transaction, known as a “timestamp.”
The “proof of history” or simply the clock mechanism works by depending on the “POS” mechanism for collecting and verifying data with the help of the “BFT” algorithm.
Solana’s SHA-256 algorithm ensures that validators have provided priorly inputted data and thus, validate it using the hashing system. Validators can move forward only after inputting the hash sequence and proceed toward the activation of the timestamp for a transaction.
With the support of blockchain technology and a decentralized system, each of Solana’s nodes keeps the timestamp mechanism for recording the data of transactions or any event, thus eliminating the need for waiting unnecessarily for any validators, making the service even faster.
What Is The Solana Coin Used for?
One can use Solana in various ways, apart from paying transactional fees or using it for investing and crypto staking purposes. Having a Solana coin or token, one can utilize it in the following ways–
- Developing dApps: Using Solana, developers can create smart contracts for creating, maintaining, testing, and applying Decentralized Applications on the blockchain system.
- DeFi: DeFi (Decentralized Financial Institutions) is a popular platform available via Solana. The Defi features include a crypto wallet, exchanges, automated financial contract systems, DEXz, etc.
- NFTs: If you wonder what is solana NFT, well, Solana also offers to create NFTs (called Solana NFT) with it, helping the SOL users purchase valuable artworks.
Besides the ones mentioned above, SOL owners can further involve themselves in gaming, lending currency, web3 apps, etc., with Solana coin.
What Makes Solana Unique?
So, what makes Solana different? Solana’s criticism puts it in the limelight for utilizing an unconventional way of using the blockchain mechanism. Instead of using the well-known “proof of work” mechanism, where miners get the feature to determine the upcoming blocks, and the “proof of stake” mechanism, where the stakes are used to define the same, Solana’s blockchain chose a unique path of running the blockchain, the “proof of history” mechanism.
This revolutionary blockchain system empowers the validators to carry out the transactions quickly and gives them the right to cast votes on the “timestamps” of the nodes. All these ultimately help maintain the system’s decentralization features while providing a much faster service to the crypto users.
How To Invest In Solana?
Pyth crypto is one of the leading crypto market trend publishing sites, and according to its published market news, Solana price prediction shows a promising future. Now one may wonder what is Solana price. Solana price is addressed to the fiat currency against which one purchases it from crypto exchanges.
As Solana is becoming one of the major cryptocurrencies in the digital currency market, one can find it in any leading exchange platform, such as Kraken or Coinbase, nowadays.
The steps for purchasing or investing in Solana from exchanges are as follows –
- First, one must have a crypto exchange account (such as Coinbase) to perform the transactions for investing in Solana. Signing up for a widely acknowledged exchange account will help you link your crypto wallet and proceed with the following steps.
- After signing in to your account, you need to have funds in it for making transactions. Most exchanges provide options like using a bank credit card or direct account transfer, while some also offer to use a debit card.
- Once you have funds in your account, you can start a trade to purchase Solana. Select the “buy & sell” option and click on buy. There you will get options for cryptos; choose Solana from the list.
- Now enter the number of the amount you want to spend for purchasing Solana, confirm it via the “preview buy option,” and finalize the deal.
- Once you finalize your purchasing order, you will receive a confirmation notification, and your account will have Solana coins.
- Now, store the Solana securely either in a hot or cold wallet for easy transactions while investing at the very same time.
Now that you know what is solana crypto and how it works, you can stake your crypto assets more wisely and invest to receive a high-profit return. The comparatively low transaction cost of the Solana network and fast service are helping the crypto users to meet their expectations, and these are gradually triggering the cryptocurrency to overtake the top position as a crypto coin in the digital currency marketplace.
Apart from being used as a crypto coin, the other beneficial uses of the Solana crypto, such as developing apps or using it as NFTs, etc., started prompting people to consider the blockchain network over other platforms. Hence, there is no need to be confused about Solana vs Ethereum, as both are high-speed and reliable service providers; however, the benefits of using Solana may help it surpass the popularity of the Ethereum network in no time soon.