As a researcher with a background in blockchain technology and a deep-rooted passion for the crypto industry, I have been closely following Solana’s remarkable journey since its humble beginnings. Having witnessed firsthand the challenges faced by early adopters and the complexities of other blockchain networks, I can’t help but be impressed by Solana’s consumer-centric approach.

In the wake of the unexpected FTX incident that caused Solana’s native token price to sink to low single digits, Solana has surpassed all predictions and emerged as something more than a longshot contender. With VanEck’s recent application for a Solana Exchange-Traded Fund (ETF), Solana is now knocking on the door of joining the major leagues.

What is it about Solana that led Pantera Capital to label it the “macOS of blockchains”? The answer lies in its exceptional user experience. Solana stands out as the most accessible blockchain, aiming to bridge the gap between users and complex blockchain technology, sometimes even concealing its on-chain features.

Solana’s monolithic blockchain architecture

In contrast to modular blockchains such as Ethereum and Cosmos, Solana’s monolithic network design enables integrated functionality among its components. This design choice leads to an optimized and streamlined user experience, akin to Apple’s operating systems.

Solana’s architecture allows for impressive handling capacity and affordable transaction costs, making it an ideal choice for decentralized finance apps, DePINs, and other low-friction blockchain projects like Blinks. Developers and users are drawn to Solana due to its optimized infrastructure, resulting in a surge of retail activity and increased DEX volume on the network. Consequently, Solana’s user base and transaction volume have experienced significant growth, establishing it as a leading contender in the blockchain landscape.

Growing on-chain activity

The expansion of Solana is clear with the surge in unique active addresses, rising from 14,000 in October 2020 to approximately 1.34 million currently. Moreover, priority fees have experienced substantial growth, escalating from under $100,000 monthly in mid-2023 to over $60 million in March 2024. Additionally, decentralized exchange (DEX) volumes on Solana have seen a significant uptick, going from zero percent in early 2021 to more than 24% by May 2024. Furthermore, around 85% of all new tokens launched on DEXs as of May 2024 were built using the Solana platform.

As a researcher studying blockchain trends, I’ve found it straightforward to elucidate the surge in on-chain growth for Solana. This platform has gained significant traction among creators of new tokens and meme coins due to its user-friendly interface and impressive speed, not to mention its low transaction fees. The popularity of Solana has skyrocketed amongst casual traders as a result. Additionally, the proliferation of Telegram trading bots has undeniably played a role in the on-chain explosion on Solana. Community-driven meme tokens like Dogwifhat (WIF) have even reached market caps in the billions.

The world’s first mainstream blockchain

It would be narrow-minded to solely credit Solana’s expansion and potential to financial markets. Indeed, platforms such as MarginFi and Jupiter are innovating with user-friendly DeFi solutions that don’t necessitate substantial funds for users to enhance their trading experience. However, Solana showcases much broader capabilities.

It’s plausible that the reason for Pantera Capital’s recent fundraising effort, which aims to acquire up to $250 million in SOL tokens from the FTX bankruptcy estate at a discounted price, follows their substantial investment in April. In this instance, Pantera Capital and Galaxy Trading collectively purchased approximately 30 million locked SOL tokens, valued at around $1.9 billion.

Despite the impressive 723% increase in SOL‘s price within the past year, Solana offers venture capitalists various prospects beyond merely investing in the SOL token. It’s evident that crypto-related technologies and web-based systems integrating web3 functionalities are more accessible to the average user than blockchain-centric solutions. Solana is among the most popular blockchain networks today and is determinedly paving the way to bring crypto offerings to a broader audience.

Why venture capital is bullish on Solana

If Apple’s comparisons hold validity, Solana would have achieved providing users with enhanced web3 experiences that revolutionize the way we interact, exchange value, and generate content. From real estate to digital networks, from AI applications to identity verification systems, numerous projects are under development on Solana. For instance, Privasea is a technology designed to authenticate human presence to safeguard the digital existence of genuine individuals against bots and AI deceptions. With deep fakes, sybil attacks, and other digital deceit methods proliferating at an alarming rate, innovations like Privasea tackle a crucial aspect of modern life.

Grass, which runs on Solana, offers an innovative solution for giving users control over how data is gathered for AI applications. If successful, this platform could shake up the multi-billion dollar AI industry, currently dominated by a select few players with the vast computing resources required to crawl the entire internet. With over two million active users and growing, Grass presently enables fine-tuning of specific AI models and real-time inference adjustments. By reaching 25 million users, Grass is expected to be capable of collecting enough data weekly to retrain ChatGPT from scratch!

As a crypto investor, I’d like to clarify that while crypto is not the same thing as Web3, it plays a crucial role in preserving its free and open nature. The internet initially emerged as a realm of unrestrained freedom where web 1.0 users operated beyond societal constraints. Anyone could publish content without interference. However, with the advent of web 2.0, centralized platforms and intermediaries took control, leading to concerns about privacy, censorship, and loss of user autonomy.

— drej (e/acc) (@0xdrej) June 25, 2024

In conclusion, detractors bring up Solana’s past network interruptions as a potential concern. However, this assessment overlooks the upcoming major update, named Firedancer, which is scheduled to launch next year. Preliminary versions of this upgrade are currently being implemented to enhance the network’s ability to handle congestion. The unique circumstances surrounding Solana position it as an attractive destination for the next wave of blockchain adopters, unlocking new markets and reinvigorating existing ones. Given this context, it is no surprise that venture capitalists are making significant investments in the platform with a long-term vision.

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2024-07-18 16:22