Solana

What is SOL?

Solana is a blockchain platform that includes proof of history (PoH) technology to improve speed without sacrificing security. Because of its PoH technology, Solana is one of the fastest blockchains available, with an average processing speed of 2,700 transactions per second. The native cryptocurrency of the Solana network is the SOL token, which is currently in the top ten of all cryptocurrencies for market capitalization.

Use cases of SOL

Transaction fees: The SOL token is used to pay transaction fees on the Solana network, which are remarkably low thanks to the high throughput of SOL. Transaction fees on SOL average $0.00025 per transaction.

Staking: Like many other cryptocurrencies, holders can stake their SOL for rewards, governance voting and gain eligibility to become a validator.

dApps and smart contracts: Similar to Ethereum, SOL uses smart contracts that support decentralized applications, and there is a tremendous variety of dApps that exist in the SOL ecosystem.

Creating currencies: Many dApps within Solana have created their own currencies, which power their projects. SOL is an attractive blockchain for this use due to its scalability.

Why is SOL getting attention?

Ethereum alternative: Solana is an increasingly popular alternative to Ethereum thanks to its lower fees and faster speeds.

Hub for NFTs: With lower congestion than other blockchain platforms, SOL could become a standard for those looking to build and host an NFT marketplace or explore gaming applications in crypto.

DeFi projects: The Solana ecosystem houses a wide variety of DeFi projects, such as decentralized exchanges (DEX), lending protocols, crypto wallets, investment platforms, and payment systems.

Investment Risk

Crypto Asset Risks

Here are some common risks to understand before investing:

• Investment Risk: Crypto asset performance can be volatile, with value dropping as quickly as it can rise. You should be prepared to lose all the money you invest.

• No Protections: Crypto assets are generally unregulated. You will not have access to financial compensation schemes or ombudsman services in the event something goes wrong with your investments.

• Complex: Crypto assets are complex. Do your own research before investing. If something sounds too good to be true, it likely is.

• Diversification: Putting all your money in a single type of investment is risky. It is good practice not to investment more than 10% of your money in high-risk investments such as crypto assets.

Staked Asset Risks

Staked crypto assets are locked on the relevant blockchain protocol to secure the network and earn rewards. This may present some risks:

• Slashing Risk: Staking may result in losses if the network penalises your validator for malfeasance, whether intentional or due to software issues.

• Liquidity Risk: Some protocols lock staked assets for specific periods, limiting quick access or sale.

• APY Not Guaranteed: Staking y yields are determined by the protocol and may vary over time.

• Protocol Risks: Changes or updates to staking protocols can introduce new vulnerability or unforeseen outcomes.