Solana — the alleged ‘Ethereum killer’ backed by a raft of venture capitalists — is now a top eight cryptocurrency.
Not bad for a token that was first listed on Binance last April.
SOL is now up 6,500% in the year-to-date, having jumped from $1.50 to $104, where it trades at press time.
This grants SOL a market value close to $30 billion. The token eclipsed interoperability chain Polkadot and Circle’s stablecoin USDC late Sunday.
SOL’s market value was less than $130 million this time last year. Now, Solana is just $6 billion away from fan favorite Dogecoin.
Solana would need to surge about 20% from here to knock DOGE out of the top eight (if Dogecoin maintained its current value).
Much like Ethereum, Solana supports smart contracts, which allows it to host its own brand of decentralized exchanges and lending protocols.
There’s also SOL-bound NFTs and marketplaces on which to sell them.
Solana runs on Proof-of-Stake (kinda)
It’s worth noting that Solana runs with a consensus algorithm similar to Proof-of-Stake, which differs dramatically from Bitcoin’s Proof-of-Work.
Solana’s system treats transactions as legitimate if 33% of the network agrees. That’s less than Bitcoin and Ethereum, which need over 50% consensus (although Ethereum is plotting a switch to require just one-third as well).
Solana boasts a touch under 1,000 validators. Those participants lock their tokens in the network to earn the right to process transactions for a reward, rather than run mining rigs to generate new crypto.
Their SOL serves as collateral in case they try to game the system.
But while 1,000 validators is decent, only 18 addresses control enough SOL to meet that 33% magic number.
So, if the owners of those 18 addresses agree, they could process whatever transactions they please and even shut down the entire network — which calls Solana’s decentralization claim into question to some degree.
Sam Bankman-Fried likely well chuffed
Likely, few are celebrating more than Alameda Research’s Sam Bankman-Fried, who also runs crypto exchange FTX.
Alameda Research invested an undisclosed amount in the project’s $300 million-plus token sale, which was finalized earlier this year.
VC giant Andreessen Horowitz, CoinShares, and Polychain Capital also bought tokens, among others.
Protos figured we’d celebrate Solana’s entry into crypto’s coveted top eight with a bar chart race.
Check it out below: it documents the fledging blockchain’s rise from barely noticeable to almost $30 billion.
And all in true Solana Summer fashion.
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