While Solana’s crash from its crypto moon landing is probably aging news, investors have the potential to learn some lessons from its infamy. Not only does it denote the tightwire walkway that many Bitcoin competitor currencies have to traverse, but it shows the market brutality for newbie coins.
In September, Solana’s value took a significant nosedive as it suffered another massive outage that halted the activity on the network. It is reported that a misconfigured node resulted in the network failing to process transactions.
The outage which took place on Friday the 30th of September is the fourth outage the famous network has suffered. A Solana validator tweeted “It appears a misconfigured node caused an unrecoverable partition in the network.”
Some analysts are recommending crypto investors steer clear from Solana as it has become synonymous with outages. The current interruption continued for 8 hours, in that period there was a noticeable dip in the markets.
Benefits of understanding crypto
Over the past few years, cryptocurrencies have become extremely popular in more business sectors including crypto as a form of payment. There have been considerable benefits to using crypto, inclusive of transparency, accessibility, and diversification.
Becoming a part of the crypto world may seem intimidating as it’s a new market and hasn’t been around as long as fiat money and banks. Diversification is part of the process and includes accessing eclectic reading material from any digital currency blog, even if their sphere of crypto investment is not gambling-related. The broader an investor’s portfolio of knowledge is, the easier it is to understand the market variances.
Understanding a cryptocurrency’s tokenomics – coins that are in circulation and their market capitalisation – is a big step in the right direction of making sound investment decisions. Understanding crypto, blockchains and consensus mechanisms may lead to a renewed mindset and the discovery of new crypto concepts.
History of Solana Coin
Since its launch in 2017 Solana has been growing at a rapid rate and continues to advance. Its cryptocurrency was made accessible for purchase in 2019 via private token sales and released for general public sales in 2020. Solana is an altcoin also known as the “Ethereum Killer”.
Solana is a blockchain platform reputable for its transaction speed and minimal transaction fees. These two factors have positively impacted the coin’s reputation and led to its growing popularity.
It uses proof of history, a unique algorithm that validates transactions. This method can be seen as a hybrid variation of the proof-of-stake consensus mechanism for more efficient processing.
The platform can process 65, 000 transactions per second, with a general cost of $0.00025 per transaction. Because it’s built on an open-source blockchain, it can be used for, minting and trading NFTs and making blockchain games.
Solana Pros and Cons
Solana was built with low transaction fees and transaction speed as its primary goal, made possible by its substantial number of users. The proof of history protocol has allowed for high levels of scalability and a whole slew of other innovative ideas.
Over 5000 dAPPs are being built on the ecosystem. Unfortunately like everything in life, there are risks associated with Solana. The reliability of the network can be questionable because it suffered at least four known outages one lasting almost 17 hours.
Solana does not have a cap on the total number of coins that can be produced. Leading to the inflation rate decreasing by 15% every year.
Solana is still a fairly “new” cryptocurrency and has not yet reached the heights of Ethereum and Bitcoin. Blockchain technology is constantly improving and could positively impact the stability of the network.
