Solana Might Be The Next Visa Of the Crypto World• January 16, 2022 2:38 pm • Comments
The Solana blockchain has been nicknamed the “the next Visa” within the digital asset industry despite it being a relatively new player that was launched in 2020.
Since inception, the Solana blockchain has already settled 50 billion transactions and more than $11 billion in total assets.
To give some comparison on the scale of use regarding this blockchain, currently Visa has settled 164 billion transactions in the past year which makes Solana almost have a third of Visa’s volume of transactions.
There are multiple reasons for why Solana was able to achieve a rapid rate of adoption according to Bank of America.
.@solana could become the @Visa of the digital asset ecosystem, according to the @BankofAmerica.https://t.co/8rovPrtp2H pic.twitter.com/3IlKGoQW6c
— ICO Drops (@ICODrops) January 13, 2022
“Solana prioritizes scalability, but a relatively less decentralized and secure blockchain has trade-offs, illustrated by several network performance issues since inception,” Shah said.
“Ethereum prioritizes decentralization and security, but at the expense of scalability, which has led to periods of network congestion and transaction fees that are occasionally larger than the value of the transaction being sent.”
Bank of America said Solana and other blockchains could grab market share from Ethereum over time, and will begin to distinguish themselves through user adoption and developer interest.
Other third parties besides Bank of America also agree to this view and have weighed in their thoughts on Solana’s future place in the crypto industry.
Sam Bankman-Fried, the founder of cryptocurrency exchange FTX, mentioned that Solana had a real chance of becoming as widely used as Bitcoin due to the speed of scaling that it has.
Another main advantage that Solana has over other blockchains is that it consumes significantly less energy than many of its other competitors which makes it much more environmentally friendly.
To give an idea of how little energy it consumes, a single Solana transaction consumes less than the amount of energy required to do two Google searches making it highly electricity efficient.
Solana is not without its problems however.
Looking at the blockchain’s history, it had suffered from outages in the past as well as multiple performance issues.
The nature of it is also less decentralized than Ethereum which would potentially make it more vulnerable to security issues.
As of right now, it is clear that both Solana and Ethereum specific pros and cons that make each more suited to specific use cases and applications.
As a result, many analysts that both blockchains will play a significant role in the future and the crypto industry continues to mature and experience more adoption.
As Shah sees it, though, this isn’t a zero-sum game.
Solana could thrive for microtransactions and NFTs, while Ethereum’s potentially more robust network could make it optimal for high-value transactions, identity, data storage, and supply-chain uses, he notes.
Investors do seem to be betting on Solana as a major rival.
Its native token, SOL, is now worth $49 billion in market cap, surging 6,140% in the past 12 months from $2.50 to $156.
As of right now, there is no clear winner as each blockchain seems to have its own role to play.
Solana, Ethereum, and Visa itself are all players attempting to connect traditional payment networks to the decentralized world of finance being pushed by these blockchain technologies and there is always room for more competition in the future.
Visa starting to pay attention to #solana 👀https://t.co/VqccZBAGPK
— Lark Davis (@TheCryptoLark) January 6, 2022
Join the conversation!
We have no tolerance for comments containing violence, racism, profanity, vulgarity, doxing, or discourteous behavior. If a comment is spam, instead of replying to it please click the icon below and to the right of that comment. Thank you for partnering with us to maintain fruitful conversation.