SOL - Is Solana Summer (Finally) Upon Us ?
Many crypto analysts have spurned Solana (CRYPTO: SOL) as an Ethereum knockoff, but it may finally be coming into its own. If crypto intrigues you, but the high prices and environmental impact of Bitcoin and Ethereum are turn-offs, maybe you've heard of Solana as an alternative. Is "Solana Summer" an investment opportunity? Solana differs from Bitcoin and Ethereum in some fundamental ways, and its current price is an attractive entry point. While other cryptos have plummeted, Solana is enjoying a comparatively stable price and increasing adoption, along with a growing non-fungible token (NFT) market. Yet not everything is sunny for Solana: Would-be investors should consider its drawbacks. Either way, you're likely to hear more about Solana in the coming months.
Solana is an open-source blockchain platform that launched in March 2020. Its lightning-fast processing speed and low transaction fees quickly propelled it into the top 10 cryptocurrencies by market cap, but Solana also boasts technical innovations that differentiate it from competitors. The Solana Foundation designed it as an infrastructure inviting adoption through dApps (Decentralized applications, or software that can run entirely on the blockchain), rather than acting as a store of value like Bitcoin. Solana's proof-of-history (PoH) consensus method differs from rivals by validating transactions through nodes that can identify precisely when a transaction posts instead of having miners solve cryptographic challenges, like Ethereum and Bitcoin. Far more energy efficient than Bitcoin or Ethereum, the Solana protocol doesn't gobble electricity with mining. The PoH protocol permits simultaneous transaction processing, which also improves its energy efficiency. Last year, the successful releases of several NFT collections on Solana increased its visibility – particularly among those unable to stomach Ethereum's astronomical transaction fees.
Although Solana's price is down dramatically compared to last fall's all-time high of $259.03, the context of today's crypto market makes this decline seem moderate. SOL is currently trading at $35.43 USD. This time last year, it traded for $35.60. Compare that to the recent declines in Ethereum's or Bitcoin's prices , and Solana seems comparatively low-drama.
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Is "Solana Summer" (Finally) Upon Us ?