Solana is one of the most talked about cryptocurrencies outside Bitcoin, Ethereum and Ripple. In this piece, we’re discussing what Solana is all about, the history behind it, how Solana is different, and how you can invest in Solana and other cryptocurrencies with an IRA. You can find a good Solana Coin review here, covering the facts, background, latest news and a couple of updates from the most recent Solana Breakpoint conference.
If Solana is a digital asset you feel may benefit your IRA portfolio, then we recommend diving deeper into this project and we’re giving you a head start below.
History of Solana
Anatoly Yakovenko (pictured right at the Solana Breakpoint conference) is the co-founder and current CEO of Solana.
A former Qualcomm engineer, he wanted to create a blockchain platform that could handle high volumes of transactions with low latency and low fees. The Solana coin (SOL) serves as its native cryptocurrency. In the same way as Ether – second largest crypto in the world after Bitcoin – is the native coin of Ethereum.
In March 2020, Solana launched the mainnet beta of its blockchain platform, capable of handling up to 65,000 transactions per second. Since then, the platform has gained traction, attracting a number of projects and a $40 million investment from Silicon Valley-based venture capital firm Andreessen Horowitz.
SOL has also seen significant growth in value, starting at $1.50 in March 2021 and surpassing $200 by September of the same year, making it one of the top 10 cryptocurrencies by market capitalization. Like the rest of the crypto market, SOL suffered during the ‘crypto winter’ bear market of 2022. And, was hit further than others due to its association with Sam Bankman-Fried of the infamous FTX scandal of Q4 last year.
How is Solana different?
When Solana first broke into the space, it had unrivaled speed and costs. So much so, that it’s competition – both old and new – had to play a game of catch up. One of the pioneers of the ‘proof of stake’ consensus mechanism (how transactions are validated on the blockchain), Solana also utilizes proof of history.
Without getting into too much technical jargon, the proof of history consensus mechanism makes the Proof of Stake method more efficient and resilient in Solana. For reference, Ethereum – the biggest blockchain in the world, and the home of Ether, the largest altcoin – has only recently switched to proof of stake from proof of work. In that sense, Solana was ahead of the pack. Although, there are some that still argue for the fundementals of the proof of stake mechanism, arguing it’s the basis for Bitcoin and that the environmental concerns are overblown.
In any case, the team behind Solana strive for the leading edge. But it’s certainly not just the combination of proof of stake and proof of history that help the Solana network and its SOL coin excel. For the sake of brevity, we’ve listed its main benefits below in bullet format.
- Fast and cheap transactions: Solana’s blockchain platform is capable of processing up to 65,000 transactions per second, making it one of the fastest blockchain networks. This allows for quick and cheap transactions for users.
- Scalability: The Solana platform is designed to be highly scalable, meaning that it can handle large volumes of transactions without sacrificing speed or efficiency.
- Low transaction fees: Due to its high speed and scalability, Solana’s transaction fees are almost always lower than its closest competitors. But like all networks, this can vary depending on factors such as network congestion and demand.
- Growing ecosystem: The Solana ecosystem has seen super speedy growth in recent years, with many exciting new projects and developers building on the blockchain.
- Strong community: The Solana community is known for its active and engaged members who are dedicated to the platform’s success. If you head over to Twitter you’ll see how much chatter there is about the project, and its NFTs in particular.
What's the difference between Solana and SOL?
Solana is a blockchain platform with benefits as described above. SOL, meanwhile, is the cryptocurrency used on the Solana blockchain. When you want to pay for transactions or participate in the platform’s governance, you’ll need to use SOL. While Solana and SOL are related, they refer to different things. Solana is the technology platform, while SOL is the currency used on that platform.
Although there is the typical confusion between the blockchain and the coin, which is common across crypto projects, Solana also has various affiliated websites. It can be a little confusing at worst, and an information overload at best. So, we’ve done our best below to break each touchpoint down for you so that you can digest it a little easier.
The official Solana websites
Below is some more information about the official Solana sites and what you can expect on each of them.
- https://solana.com is the official website for the Solana blockchain. If you want to learn more about Solana’s technology, use cases, or development, this is the place to go. They also offer resources for developers and users.
- https://solana.org is the website for the Solana Foundation, which is a non-profit organization that supports the growth of the Solana ecosystem. If you’re a developer or project looking to build on Solana, you might want to check out the foundation’s grants and resources.
- https://solanabeach.io is a block explorer for Solana. This tool allows you to view and track transactions on the Solana blockchain. You can find data on transactions, blocks, and accounts on the network, which is useful for both users and developers.
Can you use an IRA for investing in Solana?
Yes, while investing in IRA’s is possible, there aren’t that many that invest in some of the best cryptocurrencies. In fact, you can sign-up with Bitcoin IRA and get started already today. Meanwhile, Alto IRA have a waitlist for staking Solana coins.
There are several different types of Solana IRA, such as Solana 401k IRA and Solana Roth IRA. Or, you can also go for a more general crytpocurrency IRA that covers several of the major coins. Talk to a cryptocurrency expert from IRA Invest today and learn which options are available. And, which ones are most suitable for you.