Solana is a high-performance blockchain platform created to scale decentralized applications (dApps) and smart contracts. In 2017 Anatoly Yakovenko, Eric Williams, and Greg Fitzgerald founded the Solana project. In 2018, the team launched the first testnet, and in 2020, created the Solana Foundation, a non-profit organization responsible for the development of the ecosystem. The project is headquartered in Geneva, Switzerland.
Solana: Key Information (as of February 23, 2025)
Platform: Blockchain
Block time: 400-800 milliseconds
Transactions Per Second (TPS): 4,000–4,500
Transaction fee: 0.00019 EUR
Consensus Mechanism: Proof of History (modified Proof of Stake with a time component)
Programming language: Rust
Tokens in circulation: about 491,086,750 SOL
Sol Price Chart: $156.1
What Makes Solana Unique?
Solana processes over 50,000 transactions per second (TPS), which is higher compared to many other blockchains. According to developers, the network will reach speeds of over 700,000 TPS in the future. For comparison, the Visa network supports about 65,000 transactions per second. Solana’s high throughput is achieved through a combination of the following technologies:
- Proof-of-History (PoH): a mechanism that optimizes the time spent confirming transactions by synchronizing the blockchain.
- Tower BFT: An improved version of the Practical Byzantine Fault Tolerance algorithm that provides consensus without considerable delays.
- Turbine: A protocol that splits data into small layers for faster transmission among network nodes.
- Gulf Stream: A protocol that allows transactions to be directed to an expected leader without using a mempool, reducing confirmation times.
- Sealevel: An engine that provides parallel transaction processing.
- Pipelining: a technology that streamlines the input data processing workflow.
- Cloudbreak: An account database that optimizes parallel reading and writing of data.
- Archivers: a distributed data storage system for registry purposes.
SOL Token
SOL is the native token of the Solana network, used for transaction fees, staking, and interactions with decentralized applications. The token’s maximum emission is 489 million, with 161.12 million SOL first released.
Solana Ecosystem
Since its launch, Solana has attracted many projects to help grow its ecosystem, including decentralized finance (DeFi) platforms like Serum and Raydium, and NFT marketplaces like Magic Eden. DappRadar currently lists over 95 DeFi projects for Solana, of which around 90 are active (as for February 2025).
The non-profit Solana Foundation, Solana LabsEcosystem, and many other third-party organizations, including Anza, Colosseum, Helius, and Superteam support the development and growth of the Solana Ecosystem. Solana Labs has raised over $335 million in private and public token sales.
Solana’s stability has catalyzed its ecosystem to grow. According to a Messari report, total revenue generated by apps on the network increased 213% year-on-year to $840 million. The growth of blockchain is primarily driven by the increased use of decentralized applications, non-fungible tokens (NFTs), and other innovations based on the technology. In addition, the decentralized finance (DeFi) sector on the Solana platform has grown rapidly, increasing the total value locked (TVL) by 64% to $8.6 billion. This allowed Solana to become the second-largest DeFi ecosystem, ahead of Tron.
Institutional interest remained strong, exemplified by Visa’s expanded pilot of USDC settlement on Solana and the addition of Solana support for Société Générale’s digital stablecoin issuance. SOL’s market cap increased 27% quarter-on-quarter to $91 billion, reflecting growing adoption of the network and investor confidence.
Challenges and Competitors
Solana’s main competitors are Ethereum, Cardano, and Polkadot. While Solana has many technical advantages, it still faces some difficulties. The network has already experienced several outages, such as in February 2024, when a technical glitch stopped the blockchain for 40 minutes. In addition, new players are actively developing in the market, such as Aptos and Sui, which promise to process up to 150,000 transactions per second, which is significantly higher than Solana’s current capabilities.
Future Updates and Prospects
Consumer-focused initiatives on Solana have also shown impressive results. New products like the Solana Seeker Phone and updates from Dialect have played a key role in expanding the network’s reach to a wider audience. The launch of Blinks, a feature meant to integrate blockchain transactions into digital surroundings, demonstrates a continuous commitment to user-friendly solutions.
The introduction of Agave V2 improved transaction scheduling, while the upcoming Firedancer client promises to improve scalability. Furthermore, innovations such as ZK Compression were introduced to optimize blockchain usage, reinforcing the network’s commitment to maintaining high throughput and low transaction costs.
Renewed confidence in the stability of the Solana network is attracting the attention of institutional investors. VanEck, a renowned global investment management firm, has released a price forecast for Solana (SOL) for the end of this year. According to the company, SOL could reach $520 per unit by the end of 2025. In addition, the company expects Solana’s market share to increase to 22% by the end of the year. VanEck’s ratings for SOL are based on operational stability, ongoing network innovation, and growing demand and adoption.
Conclusion
Solana has demonstrated significant advances in scalability and transaction processing speed, offering innovative solutions for decentralized applications. However, to maintain its position in the market and further grow, the project needs to continue improving its technology and expanding its ecosystem, given the competition from other blockchain platforms.