In the ever-expanding universe of blockchain, where scalability and speed are often the subject of intense scrutiny, Solana emerges as a beacon of innovation. Since its inception, Solana has captivated the attention of developers, investors, and enthusiasts alike with its ambitious vision and groundbreaking approach to blockchain development.
1. The beginning
Let’s rewind it back to 2017, when the first concept of Solana came alive under the form of a draft whitepaper, released by its creator Anatoly Yakovenko, about what was a seemingly novel method of time-saving for distributed systems.
Anatoly Yakovenko has previously worked for Qualcomm as Senior Staff Engineer Manager (2015-2016), he then joined Mesosphere, and later, Dropbox as a Software Engineer in 2016-2017 before the foundation of Solana.
The mentioned method was called Proof of History (PoH), describing a protocol where a sequence of transactions would be automatically sorted promptly and effectively, eliminating the time needed for the process of achieving an agreement.
Feeling his innovation could be a breakthrough, especially when Bitcoin, Ethereum and others alike were facing some common constraints regarding the scalability and speed, quote:
“Anatoly watched as blockchain systems without clocks, such as Bitcoin and Ethereum, struggled to scale beyond 15 transactions per second worldwide when centralized payment systems such as Visa required peaks of 65,000 tps. Without a clock, it was clear they'd never graduate to being the global payment system or global supercomputer most had dreamed them to be. When Anatoly solved the problem of getting computers that don’t trust each other to agree on time, he knew he had the key to bring 40 years of distributed systems research to the world of blockchain. The resulting cluster wouldn't be just 10 times faster, or a 100 times, or a 1,000 times, but 10,000 times faster, right out of the gate!” [1]
Anatoly collaborated with his former Qualcomm colleague, who then became the CTO of Solana, Greg Fitzgerald to start prototyping and implementing the idea.
Later on, Stephen Akridge came into the picture, suggesting an approach to improve the transaction throughput by “offloading signature verification to graphics processors” [2]. This brilliant proposal stroke a significant enhancement to the existing innovation, not only demonstrating Solana’s promising triumph as a top blockchain platform but also its capacity for innovative problem-solving within the blockchain space.
Anatoly, Greg and Stephen then co-founded a company named Loom to manage their project, and finally rebranded it to Solana, followed by the testnet launch in the same year.
2. Took the world by storm
On 28th April 2018, Solana’s Founder and CEO, Anatoly himself, had a elevator pitch at the Xoogler Demo Day, in which he provided an 3-minute overview of Solana, as well as introducing Solana as “The World’s Fastest Blockchain” [3].
And from then onward till the end of July 2019, Solana had successfully highlighted itself on the map of Blockchain world as it announced to have raised up to 20 million dollars in funding “in Series A led by Multicoin Capital. We also have participation from Blockchange BC, Blocktower Capital, Distributed Global, Slow Ventures, amongst several other fantastic VC’s we’ve had the pleasure of working with”, according to their announcement video posted on Twitter on Aug 1, 2019.
And so, the race of which platform has the highest throughput has another contender. As in March 2020, Solana released it’s Mainnet Beta version to the world, shortly after raising up to 1.76 million dollars in a public token auction hosted on CoinList [4]. The year of 2020 would forever be the year that marked the mass growth and expansion of Solana ecosystem when it had successfully became the home for over 100 projects launching on its Mainnet Beta, inviting a considerable number of allies to join in the venture such as Chainlink, Circle, Audius, Akash, Arweave, Tether, Terra and much more.
Solana Ecosystem in 2020.
Solana continuously expanded its horizon, from growing a remarkable community consisting of 650k+ members, “onboarding over 350 validators, to partnering with leading projects” [5], to processing over 8 billion transactions, further solidifying itself as one of the raising stars in the vast world of blockchain. Following the launch of its Mainnet Beta, Solana then introduced what they called “Solana Foundation Grants Program” as a part of their strategy to encourage the growth of their ecosystem by awarding grants to “promising teams building projects ranging from protocol infrastructure to end-user applications” [6].
However, despite the blowing up of Solana in 2020, there were of course some minor setbacks since the Mainnet Beta was launched. One of which was when Solana encountered their first outage.
'“On Friday, December 4th at 1:46pm UTC, Solana’s Mainnet Beta network halted new block confirmations, which resulted in a temporary outage. The core developer team and Solana validator community immediately responded and were able to successfully restart the network within 6 hours.” [7]
This 6-hour outage, though did not cause any financial loss over the network halt, had stirred up the community in a negative way. Twitter seemed to be the blender where most critics laid into Solana’s troubles and poured their thoughts into it, turning the scene into a cocktail of skepticism and discontent.
Not really a good way to end a year, if you ask me.
3. DEFI Boom and Solana’s Expansion
2021 seemed to be a glorious year for Solana and its holders as it witnessed the explosion of DeFi and NFTs.
Moving on from the “notorious” incident of last year, Solana had turned over a new leaf with lots of exciting news to offer to its community worldwide. As it continued to grow, a couple hundreds more projects had chosen Solana as their final destination to settle on, the most densed populated areas were primarily DeFi and NFT sections, which investors, artists and even some political figures seemed to take an interest in.
Solana Ecosystem in March 23rd, 2021. Source: Solanians_
Solana Ecosystem in Jan 3rd, 2022. Source: Solanians_
In the course of one year, from the mark of 350+ validators joined the platform in 2020, Solana has stretched itself to adopt a total of 1351+ validators available in the ecosystem, welcoming over 300 projects being built on Solana.
Blockchain Market Cap Comparison On Dec 31st, 2021. Source: https://coin98.net/
According to Coin98 Insights [8], the set of prominent milestones achieved in early 2021 by Solana also included the $1B market cap of SOL in January 2021, only to increase 540x at the end of December 2021 where it reached a peak of $54 billion; followed by the mark of $150M Total Value Locked (TVL) of Solana in April 2021.
Again, Solana proved to be unstoppable as the figures continued to skyrocket and reach a new all time high at the end of 2021. Mentioned in the 2021 Report published by Coin98 Insights, Solana had achieved the following key milestones:
$78B was the ATH market cap of Solana (x780) (in the top 5 for a while).
$250 was the ATH price of SOL.
~300 was the number of projects on Solana (x6).
$15B was the TVL on Solana (100x).
2021 was also the year when the Solana Foundation x Serum DeFi Hackathon was first announced [9], which received a massive amount of support from other large entities suchg as Coingecko, DoraHacks, Chainlink, DeFi Alliance, etc.
Solana’s Major Events from 2021. Source: Solanians_
However, as a part of inevitable nature of life where flaws and success might often be seen hand in hand, Solana wasn’t an exception as it, once again, fell victim to another 17-hour outage due to bot infection, which was claimed by Anatoly himself on Twitter saying that “ido bots trying to snipe the tokens at launch” [10].
4. Solana losing its momentum?
On hindsight, some may reluctantly answer “Maybe”, some may nod their heads in absolute agreement yet the others might just shrug out of clueless. In fact, despite the glorious triumphs that Solana achieved in 2021, 2022 wasn’t exactly what “success” spelled out for Solana.
They welcomed 2022 with another loud bang by introducing “Solana Riptide Hackathon” with an aim of encouraging worldwide developers to build their projects on Solana.
And of course, answered the call of Solana was more than 7000 developers and 550 potential projects from all over the world. Rushing forward with another fantastic event “Solana Summer Camp Online Hackathon”, Solana had shown the world what a truly “build and build” chain should be.
Solana Pay. Source: solana.com
The debut of Solana Pay had also highlighted another glorious milestone on its journey since the foundation when Solana, collaborating with Circle, created “a decentralized, secure, and open-source payments protocol for the next generation of merchant payments” [11].
The concept of Web 3.0 has gradually taken shape, opening up a vast range of opportunities for growth and prosper to the blockchain space. On June 8th 2022, Solana Venture and Solana Foudation had announced their $100M fund for Web 3.0 Game studios, Gamefi, NFTs, Defi,.. in Korea [12], marking its venture into this new horizon of blockchain.
However, having said before, 2022 seemed to crash down on Solana harshly as the first incident involving the platform revealed itself, known as the “Wormhole Bridge Exploit Incident” with “120,000 Wormhole Ethereum (WeETH) worth over $320M” [13] was stolen by hackers. After a span of only 20 days later, the “Cashio DAO Incident” [14] has caused a total damage of $52M worth for users in Cashio DAO.
On August 9th 2022, Solana finally posted a detailed report on the “Slope Wallet Incident” happened on February 8th 2022, stating the damage suffered from the attack:
“Starting at 08-02-2022 22:37 UTC and continuing for ~4 hours, a malicious attacker or attackers drained 9,231 wallets of approximately $4.1 million worth of assets.” [15]
Then, there were a couple more astrocious incidents happened, which were the attack on Solend and Raydium; the collapse of LUNA-UST and the most prominently outstanding one was the Fall of FTX on November 12th 2022 that had led to the crumbling of various projects and the exiting of validators on Solana.
As of 11/14/22, the Solana Foundation has exposure to the below assets in connection with the transactions with FTX/Alameda specified below. These assets were held on FTX.com accounts (and continue to be held there) as of 11/6/22 when FTX.com ceased to process withdrawals.
~3.24m shares of FTX Trading LTD common stock
~3.43m FTT tokens
~134.54m SRM tokens [16]
5. Solana: The Phoenix that rises from the ashes
The beginning of 2023 was the depths of the coldest winters, a difficult time for people across the Solana ecosystem and the greater blockchain community. The Solana community not only stuck around, but doubled down. [17]
Indeed, after those unfortunate sequence of events that happened in 2022, the beginning of 2023 was the harshest blizzard Solana had to endure. Yet, there would always be rainbows after a showering rain.
On December of 2022, users of Solana started to discover something rather strange in their wallets: a shiba doggo token. This cutie little token was actually foreshadowing the first sign of resurgence blossomed on Solana called “BONK”.
As the rainbows after the rain, BONK finally revealed itself one year later to be an extremely well-received Web3 project. And the rest was history: tough times don't last, but tough people do; those who remained in uncertainty became new community leaders, once again, the wings of Solana spread wide and took off.
And then came another good news: the Solana Mobile’s Saga phone, which Solana happily announced on their tweet that “The Saga is SOLD OUT!” [18] Following this positive sign, the blockchain space might start to believe that the Renaissance Era of Solana was emerging, according to the 2023: The Year of the Solana Community report:
“In February, the Helium community voted to migrate from their own layer-1 blockchain to Solana. The migration happened at the end of March… and happened without a hitch, proving that Solana has a home for decentralized infrastructure projects and laying the path for future teams to make the leap themselves.'“
The effort of Solana Community started to bear fruits as Solana DeFi 2.0 was brought to the table, along with a new set of tools and features, getting ready for the next generation of finance.
Solana witnessed the increasing speed of innovations within its Ecosystem, this was when state compression, a brilliant idea of significantly reducing the renting expenses on the Solana network by using Merkle trees, and AI interact with the Solana blockchain plugin were first introduced widely.
Gradually, the growth of Solana’s vibrant community had drawn attention from institutions such as Mastercard and Visa. The two giants started to announce their partnership with Solana Labs on official Twitter, stating that “we’re collaborating to enhance verification in NFTs, ticketing, enterprise and other payments solutions” [19] and “We are excited to announce that Visa has expanded our stablecoin settlement capabilities to merchant acquirers launching pilots with @Worldpay_Global and @Nuvei utilizing the Solana blockchain” [20]
A wrap up of 2023 and perhaps, a big trampoline for Solana to regain their momentum in 2024 was the real-life gatherings strengthening community bonds, including the Breakpoint conference and Solana Hacker Houses, which have not only blown a new wind to the Ecosystem but also lifted the distress that burdened the hearts of those who suffered from the horrible events last year.
6. 2024 and beyond!
2024 has just come, will Solana rise again? Will it be able to, once again, take the world by storm like it used to?
No one knows, 2024 has just only started for a couple of months. But one thing that might remain unchanged at this point is that Solana and its periodic instability should now be considered inevitable best friends. As of February 6th this year, the network once again halted for roughly 6 hours due to a previously identified bug.
Yet, I assume everything could be possible, judging from the good signs that smiled on Solana in the past year, the platform might make its comeback to the public with another bangers and another innovations to offer. The fact that Solana’s SOL token outperformed several other major cryptocurrencies at the end of last year had proven enough of its ability to make a comeback this year.
“Throughout 2023, several factors have contributed to the remarkable surge in Solana's price, escalating from around $9 to $121 on December 25th, marking an impressive 1115% return,” said Hosam Mahmoud, a research analyst at CCData.” [21].
We may look forward to new initiatives, collaborations, and discoveries that will further strengthen Solana's Ecosystem and confirm its status as a key component of the Blockchain space.
Note: This research might contain limitations and might not fully reflect the most current advancements or future estimates because it is based on facts and sources that were accessible as of a specific point in time, hence the information presented within should not be considered absolute.
Readers are encouraged to complement this research with updates from trustworthy sources in order to fully comprehend Solana's current state of development and its future course.
really cool informative article on Solana. Thank you!