Author: Jasir Jawaid, Coin Bureau
Compiled by: Glendon, Techub News
From DeFi transactions to payments and gaming, real-world use exposes the gap between the vision of blockchain protocols and their actual capabilities. Blockchains that once touted high throughput as a core advantage often buckle under the pressure of peak demand, leading to extended transaction confirmation times, soaring fees, and even network outages.
For developers building consumer-facing applications, this friction is likely to become a fatal weakness affecting user transaction experiences and leading to user churn. For this reason, the current competition between Layer 1s has shifted from pure innovation to proven execution, where blockchain reliability, uptime, and support for developers, alongside scalability, have become key metrics for measuring competitiveness.
In this context, Solana stands out as a highly competitive blockchain project. This is not only due to its transaction speed but also because it addresses some major challenges in the cryptocurrency space.
As early as 2020, Coin Bureau conducted the first evaluation of Solana. Since then, the network has undergone significant evolution both technically and culturally within the community. With the completion of a series of major technical upgrades, continuous ecosystem expansion, and ongoing application scenario development, today's Solana is no longer limited to merely being a high-speed alternative to Ethereum. Based on these changes, it is necessary to reassess and reevaluate Solana.
Key points
Solana is a high-performance Layer 1 blockchain that achieves fast, low-cost, and scalable transactions through innovative technologies such as Proof of History (PoH) and Tower BFT;
Its ecosystem supports DeFi, NFTs, gaming, payments, and Meme coins, enhancing performance and user experience through tools like Blinks, Firedancer, and Sealevel;
Solana's native token SOL supports staking, trading, governance, and validator incentives, with inflation gradually diminishing over time;
Upgrades like Firedancer and Alpenglow aim to enhance the stability, level of decentralization, and sub-second finality of real-time applications;
Currently the preferred blockchain for builders and users alike, Solana continues to draw attention by providing performance, usability, and developer-friendly tools that go beyond mere speed.
Solana
Solana is a high-performance, open-source Layer 1 blockchain built for high-speed, scalable, and low-cost transactions, born to overcome the limitations of early blockchain platforms like Ethereum, providing a bottleneck-free, low Gas environment for DApps, smart contracts, and crypto assets.
Proof of History (PoH) forms the foundation of Solana's architecture, enabling it to timestamp and order transactions at extreme speeds, granting Solana its iconic throughput. The network theoretically can handle up to 65,000 transactions per second (TPS), but achieving that consistently in real-world operation is challenging—this is the theoretical maximum calculated under ideal conditions in controlled testing. In practice, the network usually reaches thousands of TPS. As of writing, Solana reports its processing speed at 3,700 TPS.
Given Solana's processing speed of several thousand TPS compared to Ethereum's approximate 15 TPS and Bitcoin's 7 TPS, it is easy to understand why Solana has garnered so much attention.
Unlike other blockchains that rely on multi-layered architectures or external scaling solutions, Solana adopts a monolithic architecture: all operations are completed on a single chain. By relying on validators and optimized runtime efficiency, the network avoids fragmentation and provides faster finality. This design makes it the preferred choice for DeFi, NFTs, and GameFi developers, while projects within the Solana ecosystem, such as Jupiter, Magic Eden, and Metaplex, continue to push the limits of Web3.
SOL, as the network's native token, plays a key role in the ecosystem: it is used to pay transaction fees, participate in validator staking, and ensure network security. As Solana's usage grows, SOL has also become a core asset for cross-chain infrastructure, with cross-chain bridges like Wormhole and Circle's CCTP facilitating value transfer across ecosystems.
Solana development history
Solana founding timeline
November 2017: Anatoly Yakovenko publishes the Proof of History white paper, proposing a new method of cryptographically adding timestamps to blockchain events.
Early 2018: Co-releases the first internal testnet with Greg Fitzgerald, capable of processing 10,000 transactions in half a second.
Mid-2018: The project is renamed from 'Loom' to 'Solana,' inspired by Solana Beach in California.
2019: Yakovenko, Gokal, Fitzgerald, and Akridge (all from Qualcomm) officially establish Solana Labs.
2020: The Solana mainnet beta is launched, bringing high throughput capabilities to the public blockchain space.
2021: Benefiting from Ethereum's high Gas fees and early DApps backed by FTX (such as Serum), Solana experiences explosive growth.
2022: FTX collapses, SOL plummets, key DApps crash, and the network enters a crisis period.
2023–2025: Solana focuses on rebuilding with decentralization, rolling out upgrades like Firedancer and Blinks to enhance user experience.
At that time, Anatoly Yakovenko published a white paper introducing a new concept he called 'Proof of History' (PoH), based on his research in distributed systems and compression algorithms. Unlike traditional consensus mechanisms, PoH provides a new cryptographic way to timestamp events, creating verifiable transaction sequences that significantly enhance execution speed (which will be elaborated in later chapters). We will delve into this in the next section.
Anatoly initially built a prototype using C language and rewrote it entirely upon realizing that Rust could offer better security and performance. At that time, Rust was still emerging in the cryptocurrency field, and Solana's adoption attracted a large number of developers eager to use modern high-performance languages. To turn this vision into reality, Anatoly collaborated with his former Qualcomm colleague Greg Fitzgerald and launched the first testnet of the project in early 2018, achieving an astonishing record of processing 10,000 transactions in 0.5 seconds, signaling Solana's potential.
The project was initially named 'Loom' but was renamed due to a name conflict with the existing Ethereum project Loom Network. The team drew inspiration from the California beaches they frequented during their time at Qualcomm, renaming the blockchain 'Solana.' After establishing the name and validating the technology, Anatoly invited Raj Gokal and another Qualcomm alumnus, Stephen Akridge, to join the founding team.
By 2021, Solana had attracted the attention of developers and users frustrated by Ethereum's exorbitant Gas fees. However, much of its early breakthroughs can be attributed to Sam Bankman-Fried (SBF) and his FTX/Alameda ecosystem. Through high-performance on-chain order book Serum and associated projects like Bonfida, Oxygen, and Maps, FTX became the primary driver of Solana's adoption. Despite some projects waning, the growth momentum of the Solana network remains strong.
However, Solana's rapid rise has not been without its challenges. Frequent network outages and centralization concerns have plagued the protocol's reputation. The subsequent collapse of FTX at the end of 2022 further devastated it: the price of SOL plummeted, DApps reliant on Serum collapsed, and the network's reputation hit rock bottom. At that time, many concluded that 'Solana is dead.'
But Solana did not sink; the subsequent rebuilding phase proved the resilience of its ecosystem—without relying on the influence of FTX.
What makes Solana unique
Why has Solana managed to stand out in the highly competitive blockchain space?
Proof of History: Solana’s secret to speed
One of the trickiest problems in distributed systems is time. How can event order be proven without relying on nodes to repeatedly verify each other when there's no centralized clock? Most blockchains rely on loosely synchronized timestamps or consensus between nodes, which can slow down speed. Solana takes a different approach: its proof of history creates a verifiable timeline of events.
At the core of PoH is a cryptographic clock. It allows the Solana network to record events in a specific, verifiable order without requiring all nodes to coordinate in real-time. Validators do not need to ask, 'When did this transaction happen?' They simply check the historical record, which proves the timing of each transaction relative to others, drastically reducing the time and computational overhead required to reach consensus.
PoH is driven by a Verifiable Delay Function (VDF)—a cryptographic process that requires known real-time calculations and cannot be shortcut. In Solana, this function involves continuously running a secure hash function (SHA256), where each output becomes the input for the next round. This continuous hashing process acts like a digital metronome, with each new output marking the network's time.
The current state and counters of the process are regularly recorded and published. Since each output relies on the previous one, and the hash function has pre-image and collision resistance, the timeline cannot be forged, skipped, rewritten, or predicted in future outputs. Just as taking a photo of a newspaper proves the time the photo was taken, inserting data into the PoH sequence can also prove its existence time.
When Solana generates a block, the designated leader node packages the transactions, timestamps them using PoH, and shares the results with the other nodes in the network. Other validators can then independently and quickly verify the authenticity and order of the blocks without needing to cross-check, achieving faster block times, lower latency, and near-instant finality.
Another advantage of the system is the ability to verify in parallel. While generating PoH sequences requires continuous execution on a single core, the verification process can be distributed across multiple cores or even GPUs. This ensures that even under high loads, the verification process remains scalable and secure.
Rust programming language
Unlike Ethereum, which uses languages like Solidity and Vyper, Solana's smart contracts (referred to as 'programs') are primarily written in Rust.
Rust is a low-level programming language designed for performance and safety. It was initially developed by Mozilla to address common issues in languages like C and C++ (particularly in memory management and concurrency). Rust's advantage is that it can achieve the speed of C/C++ while minimizing errors such as memory leaks and data races.
One of Rust's greatest advantages is that it allows Solana to process transactions in parallel, thus helping the network scale without sacrificing security. Additionally, Rust's extensive developer community has lowered the barrier for non-Web3 engineers to build on Solana without needing to learn an entirely new tech stack.
Thanks to its versatility, Rust's applications now extend beyond Solana, supporting operating systems, browser engines, and even newer blockchains like Aptos and Sui through Rust-based languages like Move.
Solana technical analysis
In addition to the innovative PoH, Solana has other technical highlights.
Tower BFT (Tower Byzantine Fault Tolerance)
Solana does not use a traditional consensus model but operates based on Tower BFT, a custom system built on Practical Byzantine Fault Tolerance (PBFT). The key difference is that Solana uses PoH to keep the entire network time-synchronized, eliminating the need for validators to constantly communicate before reaching consensus, thus saving time and reducing network overhead.
Its operation works as follows: when validators vote on a block, they commit to maintaining that vote within a certain hash period. Each time they vote again on the same chain, the timeout doubles, making it increasingly difficult to retract previous votes. Over time, votes accumulate 'weight,' making rollbacks nearly impossible. This is a clever system that rewards consistency (one vote may be retracted in seconds, while another may take years), helping the network quickly reach final outcomes.
Because PoH provides a tamper-proof timeline, validators do not need to consult each other about the sequence of events. They only need to check the ledger to verify everything. In the event of a fork (which does occur), validators will naturally choose the chain with the longest accumulated timeout, which is also the chain that is most likely to reward them.
Turbine
How does Solana quickly confirm and propagate transactions in a global network? The answer lies in its custom block propagation protocol, Turbine. Unlike traditional blockchains' 'flooding' propagation (where nodes broadcast new blocks to all reachable peers), Turbine takes a more structured approach. The 'flooding' method may work for smaller networks, but it becomes inefficient and bandwidth-intensive as the scale increases.
Turbine addresses this issue by splitting each block into smaller pieces called 'shards,' which are propagated through a hierarchical tree structure across the network. The leader node does not send the entire block to every validator; instead, it sends different shards to a select few peer nodes, which then forward them to other peers, and so forth. This reduces the load on a single node and significantly accelerates block data propagation.
Gulf Stream
In most blockchains, transactions first enter a 'memory pool', which is essentially a waiting area where they wait until selected and packed into a block. Validators typically prioritize high-fee transactions, which can lead to congestion and long delays during peak times. This is a workable system, but not particularly efficient.
Solana skips the memory pool through the Gulf Stream protocol, meaning transactions do not wait in the pool but are immediately forwarded to the current block producers, even to the next few designated leaders. With Proof of History, Solana can accurately know who the next node is. This foresight allows validators about to execute transactions to 'pre-cache' them, reducing latency and increasing efficiency.
Sealevel
Most blockchains process smart contract transactions in sequence, akin to a one-lane traffic jam. Sealevel, as a parallel execution engine, allows multiple smart contracts that do not involve the same data to run simultaneously, like a multi-lane highway. In simple terms, before execution, Sealevel analyzes each contract's demands and whether their operations will conflict. If there are no overlaps, they are processed in parallel. This design significantly increases throughput without compromising security.
Pipelining
Inspired by modern CPU task processing, Solana breaks down the transaction verification process into multiple stages through pipelining techniques, processing different stages of transactions in parallel within transaction processing units (TPUs). When one part of the TPU receives a transaction, other parts are verifying signatures or executing contract instructions, forming an efficient pipelined operation.
Cloudbreak
Storing all account data in a constantly growing database may be feasible at a small scale, but as the blockchain scales, this will become a serious bottleneck. For the network to support thousands of applications and global usage, it cannot rely on a one-size-fits-all storage model. On this basis, Solana adopts a horizontally scalable Cloudbreak storage system, which splits data across multiple dedicated storage units (like a categorized filing cabinet rather than an overloaded drawer).
Cloudbreak's efficiency is attributed to its effective read-write processing. For fast queries (like checking token balances), requests are distributed across multiple storage units for near-instant responses. When updates are needed (like transferring tokens), only the relevant specific accounts are temporarily locked, while the rest of the system remains fully accessible. This effectively avoids traffic congestion even during peak usage.
Archivers
It is well known that Solana can process thousands of transactions per second, which inevitably generates a large amount of historical data. If validators were to bear the entire burden of storing all transactions and blocks, they would quickly become overwhelmed. This is where archivers come in: they are nodes specifically responsible for storing Solana's historical ledger data and can be thought of as the custodians of the network: they do not validate transactions or generate new blocks, but they ensure that the entire blockchain's historical records remain secure, accessible, and intact.
SOL token
SOL is the native token of the Solana blockchain and can be seen as the fuel, collateral, and economic glue of the Solana ecosystem. Whether buying NFTs, swapping tokens, or running validation nodes, SOL is the driving force behind it all.
SOL token economics model
SOL carries out several key responsibilities in the network's operation, including:
Pay transaction fees (similar to Gas on Ethereum, but at a lower cost);
Stake with validators to maintain network security and earn rewards;
Interact with smart contracts and decentralized applications (DApps);
Participate in governance votes (depending on future network upgrades).
SOL token economics:
Total supply of SOL: approximately 601.5 million
Circulating supply: approximately 520.3 million (86.5%)
Non-circulating: approximately 81.2 million (13.5%)
The circulating supply includes: SOL liquid on exchanges and wallets, as well as SOL in staking (which can be unstaked at any time, thus considered circulating).
The non-circulating supply includes: locked staking accounts (from investments or grants, subject to vesting period); staking held by the foundation, which is not locked but used for delegation programs to help achieve network decentralization.
It should be clarified that locked ≠ staked. Most staked SOL is not locked. Locked SOL only refers to tokens that cannot be withdrawn or transferred before a specific date.
Inflation mechanism: Where do new SOL come from?
Currently, SOL's inflation rate is 4.514%, with an initial inflation rate of 8%, decreasing by 15% each year (approximately every 180 cycles).
Solana's inflation rate will gradually decrease over time, meaning the number of new SOL tokens minted each year will diminish, helping to maintain the system's long-term sustainability. Stakers receive rewards through inflation, so the value of non-stakers' holdings will be diluted over time. Additionally, half of every transaction fee will be burned, while the other half goes to validators. Solana's ultimate plan is to replace inflation with fee income as the primary source of rewards for validators.
Solana application scenarios
Solana serves as an infrastructure layer supporting a wide range of real-world applications from payments, NFTs, to institutional solutions and gaming. Its uniqueness lies in actual adoption rather than conceptual hype; currently, the ecosystem supports billions of DeFi assets, tens of thousands of daily active users, and has attracted partnerships with companies like Google Cloud, Mastercard, and Shopify.
Key driving forces in the domain
DeFi: Platforms like Jupiter, Orca, and Kamino are leading the DeFi revival, combining high throughput with new features like MEV optimization and automated vault strategies;
NFT and digital culture: Projects like Magic Eden solidify Solana's leading position in the NFT infrastructure space;
Enterprise integrations: Shopify merchants access the Solana Pay plugin, Mastercard builds crypto credentials based on Solana, and Asics and Boba Guys roll out tokenized products;
Gaming: Hundreds of games like Star Atlas and Aurory drive blockchain gaming development through the Solana Games Kit and Magicblock native engine;
DApps and tools: Supported by Rust, Anchor, and a rich SDK ecosystem, developer activity continues to grow, with total locked value (TVL) surpassing $9 billion.
Firedancer: Solana's secondary engine
Firedancer is a new validator client built by Jump Crypto for the Solana blockchain. Unlike Solana’s current reliance on a single client (Agave), Firedancer is a completely independent system built from the ground up. This is important because relying solely on one client means that if that client fails, the entire network could collapse. Firedancer addresses this issue by providing multiple engines for Solana.
Key points:
Firedancer provides Solana with a second completely independent validator client to reduce dependence on Agave and prevent single points of failure;
It is designed for extremely fast speeds, with lab benchmarks showing over 1 million transactions per second;
Its modular 'sharding' architecture allows individual components to run independently for greater fault tolerance;
Firedancer has a customized network stack designed to reduce latency and improve data processing efficiency;
It enhances decentralization by adding client diversity to the validator ecosystem;
Written in C/C++ for optimal performance and control over system-level operations;
A hybrid version called Frankendancer has been launched, with a full mainnet rollout expected later in 2025.
Alpenglow: A revolution in consensus mechanisms
Solana developers recently announced a significant proposal, which is not just a 'minor tweak.' Alpenglow is an entirely new consensus system that may replace Solana's current core components: Proof of History (PoH) and Tower BFT. According to the developers, this is not merely an upgrade, but a thorough rethinking of how Solana finalizes transactions and transmits data within the network.
Historical Proof (PoH) and the Tower BFT system greatly enhance Solana's efficiency, but they become complex and sometimes slow under immense network pressure. In response, Alpenglow has proposed two significant alternatives.
Votor: a new block finalization system that can reach consensus within 100-150 milliseconds.
If 80% of validators are online, one round of voting is sufficient;
If only 60% of validators respond, the system automatically switches to two rounds of voting.
Rotor: A new data relay system that improves Solana's Turbine protocol.
Fewer 'hops' between nodes;
Smarter relay selection;
Better bandwidth allocation for faster data transmission.
These systems are collectively designed to simplify the consensus process, reduce coordination delays, and improve the responsiveness of the entire network.
Why is this important? This is not just backend optimization. If Alpenglow is successfully implemented, it will change the types of applications that Solana can support, especially for real-time, high-frequency applications. In practice, this may mean:
Sub-second finality: Transactions are confirmed in the blink of an eye;
Real-time use cases: Gaming, finance, and social DApps feel truly real-time;
Better user experience: faster confirmations mean less waiting and fewer retries;
Increased demand for SOL: more applications → more users → more transactions.
Currently, Alpenglow does not have a specific release date, but its white paper has been published and community discussions have begun. If it goes according to plan, Solana could become the first major Layer 1 blockchain to continuously provide provable sub-second finality.
Solana ecosystem overview
Jupiter
Jupiter initially started as a DEX aggregator, helping users get the best contract trades, but it has now almost become the largest portal for DeFi on Solana, with features ranging from perpetual contracts and token launches to portfolio trackers and its own token terminal.
The growth of Jupiter has been aided by acquisitions, as the protocol has acquired platforms like SonarWatch, Coinhall, Solana.FM, MoonShot, and the recently acquired NFT issuance app DRiP Haus. According to the latest data from DeFiLlama, as the Memecoin craze gradually cools down, Jupiter has quietly taken the lead in generating Solana network fees, with daily revenues reaching $1.7 million.
Meteora
Meteora is a liquidity management platform on Solana, owned by the Jupiter team, running on a system called DLMM (Dynamic Liquidity Market Maker), now the preferred location for Meme tokens like MELANIA, ME, and PENGU.
Raydium
Raydium is the leading DEX on Solana and is launching a token launch platform called LaunchLab, aiming to compete head-to-head with Pump.fun.
Pump.fun
Pump.fun launched in early 2024, immediately setting the tone for Solana's next era: chaos and creativity. It allows anyone to create tokens within seconds. Pump.fun has generated over $500 million in revenue and is developing its micro-ecosystem. The platform recently launched the native DEX PumpSwap, which has lower fees and supports creator revenue sharing. All tokens from Pump.fun now default to PumpSwap instead of Raydium.
Kamino
After refining its vault system and launching Lend V2, Kamino has become the largest lending protocol on Solana, with a TVL exceeding $2.5 billion. Kamino's 'Vault Layer' automates and optimizes cross-pool lending, while its 'Scam Wick Protection' helps users avoid sudden spikes in false prices during liquidations, further enhancing lending security.
Solayer
Solayer is equivalent to Solana's version of EigenLayer. It started as a re-staking project but quickly expanded its scope. Currently, it has its own USD stablecoin (sUSD), a growing DeFi hub, and is developing a chain called Solayer InfiniSVM, which is a hardware-accelerated SVM Layer1.
Solana Meme coins
With its strong technical prowess and community vibrancy, Solana has quickly become a major platform for the issuance and trading of Meme coins. Although Meme coins are often seen as speculative or whimsical products, their success on Solana is closely related to the unique features of the network.
Solana's infrastructure is designed for speed and scale. Transaction confirmations take only 400 milliseconds, achieving near-instant execution even during peak trading periods. Coupled with extremely low transaction fees, averaging only 0.0006 SOL per transaction, this makes large-scale network interactions affordable for developers and everyday users alike.
Several core features of Solana make it particularly suitable for Meme coin activities:
High throughput ensures the network remains responsive even during large-scale token issuance;
Developers can build fully on-chain programs without the need for centralized servers or intermediaries;
Near-zero transaction fees lower the entry barrier for creators and participants.
While the technical foundation is crucial, Solana's Meme coin ecosystem is also driven by its highly active community. From social activities coordinated on Twitter and Telegram to the instant meme propagation within the NFT circles, Solana's users play a proactive role in discovering, promoting, and trading new tokens.
This 'grassroots energy' makes Solana an ideal testing ground for viral token propagation. Compared to other blockchains, high fees or slower confirmation times may hinder experimentation, while Solana can support Meme coin projects to launch and scale quickly with minimal overhead.
Summary
Today, Solana has transformed from a high-speed experiment to a robust infrastructure. With a series of innovative achievements such as the Proof of History (PoH) mechanism, the Firedancer validator client, and the Blinks state synchronization protocol, Solana is breaking through the technical bottlenecks of other Layer 1s, providing tools that Web2 users are familiar with and Web3 builders urgently need.
As the network evolves and optimizes through upgrades like Alpenglow and Firedancer, the core issue is no longer 'Can Solana's performance meet demand?' but rather how developers will leverage its speed, efficiency, and flexibility to build better applications.
