Solana

What is Solana?

Solana is an open-source blockchain. It was designed for scalability, energy efficiency, and low transaction costs. The native token of Solana, SOL, is used to pay transaction (gas) fees and for staking. Some core features include:

• Speed: Solana is capable of processing around 50,000 transactions per second, compared to ~15 transactions per second for Ethereum. 
• Energy-Efficiency: The Crypto Carbon Ratings Institute analyzed various networks and found that Solana’s energy usage per transaction was the lowest. Solana has achieved carbon neutrality through investments by the Solana foundation.  

Solana’s consensus mechanism combines Proof-of-Stake and Proof-of-History. This unique combination allows the blockchain to process transactions quickly while remaining decentralized. Proof-of-history uses timestamps to verify the time that the block was created. This ensures that transactions are correctly ordered and avoids manipulation of the data. 

Solana has a thriving NFT ecosystem. It is the third largest blockchain by NFT volume. DeFi on Solana has also experienced high growth over the past year. It has over $2B in DeFi total value locked at the time of writing. 

Built on Solana: An Exploration of Top Protocols within the Solana Ecosystem

Magic Eden

‍Magic Eden is the largest NFT marketplace on Solana. It is a decentralized marketplace for buying, selling, and minting NFTs. Solana is advantageous for NFTs as the transaction costs are minimal compared to those on Ethereum. 

An exciting feature of Magic Eden is Launchpad. This enables creators to quickly launch their NFT project on Solana, without any need for technical expertise. Magic Eden provides support and ensures that you will quickly be able to get your NFTs ready for minting. 

Magic Eden has a DAO, MagicDAO, that you can get into by holding the Magic Ticket NFT. The DAO members are able to vote on decisions and initiatives for Magic Eden. 

‍How to use Magic Eden:

The first step is setting up your Solana wallet and funding it with some SOL tokens. Phantom is a popular Solana wallet option. We have a full description and walkthrough of the Phantom wallet here.

Once you connect your wallet, you will be able to buy and sell Solana NFTs through the Magic Eden marketplace.

Orca

‍Orca is a decentralized exchange (DEX) built on Solana. Orca was designed with user experience in mind. It is intended to be accessible and simple for retail users. Orca highly encourages other protocols to integrate its exchange into their project. A DEX with sufficient liquidity is an essential building block throughout the Solana ecosystem. 

The founders built on Solana because of the prohibitively high transaction costs on Ethereum. Their focus on retail users rather than large institutional buyers led them to Solana, where transaction fees are minimal. This enables users to swap assets and provide liquidity without their balances getting eaten away by fees. 

Orca recently launched Whirlpools, which are concentrated liquidity pools. These are more capital efficient for providing liquidity. This means that liquidity providers are able to provide liquidity for a smaller range. It is a complicated topic, but the important part is that it leads to higher yields for liquidity providers.

How to use Orca:

Connect your wallet to Orca. This will enable you to use the automated market maker (AMM) to swap assets. You will also be able to provide assets to a liquidity pool, which enables trading and earns you trading fees. If these concepts are new to you, we recommend learning more here.

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What problem is Solana solving?

Decentralized blockchains enable trustless interactions, but they have generally been slow with high transaction costs. The previous way to achieve higher speeds is through centralization. Solana’s novel Proof-of-History consensus mechanism has the goal of increasing the number of transactions while remaining decentralized. 

Small payments don’t work well on blockchains with high transaction fees. Solana’s high throughput enables use cases that use frequent transactions, even for small amounts. This makes Solana a more approachable blockchain for smaller transactions and retail users. 

Why build on Solana?

• ‍Speed and Low Transaction Costs: Solana can process high numbers of transactions quickly while keeping transaction costs low. This enables many use cases that wouldn’t be financially viable on other blockchains. Solana will not need to rely upon layer-two scaling, which is beneficial for composability.‍
• Rust Programming Language:Solana Apps are built on Rust programming language. Rust is a fast-growing programming language with a strong developer base. ‍
• Strong Community:The developer community is strong, active, and growing. ‍
• Interoperability: Solana is focused on supporting tools to enable its blockchain to interact with other blockchains, enabling users of other blockchains to easily port their assets to Solana.
  

What’s next for Solana?

• Saga Andriod Phone: Solana Mobile, part of Solana Labs, recently released Saga an android phone with deep integration with Solana. Widespread mobile phone usage presents a big opportunity for better integration with digital wallets and the crypto ecosystem.‍
• Solana Pay: Launched in early 2022, Solana Pay is a new payment technology that enables merchants to receive customer payments without third parties and exorbitant fees. It uses Solana rails to enable fast and instant payments. People are calling it the “Paypal of Web3”.

Join Solana

• How to build on Solana?: Are you a developer curious about building on Solana? Check out the Solana Docs to learn more.‍
• How to work for Solana?: Look here if you’re interested in jobs within the Solana ecosystem.

Further Reading

What is Solana Pay? Coin Telegraph

Solana Summer-Not Boring

Solana Blog