Solana ecosystem, which is a cryptocurrency with little fanfare, has recently gone on a tear. Solana’s value rose from around $1.50 in January 2021 to more than nearly $208 last week, making it the world’s sixth-largest cryptocurrency with a market capitalization of $50 billion.
So, what exactly is Solana?
The Solana ecosystem is an open-source, permissionless blockchain network that offers customers decentralized banking solutions. It uses specific and unique methods of organizing transactions to improve the speed of its operations.
The SOL is Solana’s native cryptocurrency. It’s a currency that investors may use to interact with smart contracts and pay transaction fees in simple terms.
Developers are encouraged to design decentralized apps using Solana’s protocol (Dapps). It aspires to increase scalability. It will accomplish this by adding a proof-of-history consensus on the blockchain network and an underlying proof-of-stake consensus.
Anatoly Yakovenko of Solana Labs created The Solana platform in 2017. Yakovenko also worked at Qualcomm before developing the Solana ecosystem platform.
He had already earned substantial experience in compression methods while working as a software developer at Dropbox at the time. Greg Fitzgerald, Solana’s CTO, and Eric Williams, another engineer, collaborated on the project. They devised a new method for addressing the Ethereum and Bitcoin blockchains’ typical throughput difficulties.
The Solana blockchain employs a new method of transaction verification that eases the scalability and speed difficulties that plague Ethereum and Bitcoin.
It employs a proof-of-work architecture, allowing the blockchain to process thousands of transactions per second.
Solana ecosystem wants to build a trustless and distributed platform that would allow for more scalability. The team behind it has experience and skills from leading worldwide corporations such as Apple, Qualcomm, Intel, Google, Microsoft, Twitter, and Dropbox, to name a few.
The 8 main characteristics of Solana Ecosystem
To understand how Solana ecosystem functions, we need to examine its architecture. Solana is the first web-scale blockchain, and eight key breakthroughs make it so.
1. Proof of History (PoH) – A timer starts ticking when a consensus is reached.
Despite its name, PoH is a cryptographic clock that allows nodes to agree on the temporal order of events in a chain without communicating with one another because each node has its clock.
PoH improves network efficiency and throughput by keeping historical transaction records and making it easier for the system to maintain track of the sequence of events.
2. BFT Tower (Byzantine fault tolerance)
Solana ecosystem’s implementation of practical Byzantine Fault Tolerance (pBFT) is Tower BFT, optimized for PoH. In essence, this is a consensus technique that uses the cryptographic clock to obtain consensus without traveling through a large number of messages between nodes, resulting in faster transactions.
3. Gulf Stream – A transaction forwarding technique that does not use a mempool.
With Gulf Steam, Solana’s was able to achieve 50,000 transactions per second (TPS). This protocol is used for transaction caching and forwarding. This in turn lets network validators process transactions ahead of time, lowering confirmation time significantly and validator memory needs for unconfirmed transaction pools.
4. Turbine — A protocol for block propagation.
The turbine is a block propagation technology that divides data into smaller chunks to make transferring between nodes easier. Turbine assists Solana in resolving bandwidth challenges and increasing network transaction processing speed.
5. Sealevel — runtime of parallel smart contracts
Solana ecosystem can grow horizontally across GPUs and SSDs because of this parallelized transaction processing engine. Sealevel, in a nutshell, enables parallel transactions on the same chain, resulting in a faster network runtime.
6. Pipelining is a transaction processing unit that optimizes validation.
In CPU design, pipelining is a standard method. It is the assignment of a stream of input data to various devices for processing. This allows for speedier replication and validation of transaction data throughout the network’s nodes.
Cloudbreak is a data structure designed for network scalability and throughput. It organizes the account database, allowing concurrent reads and writes over the network’s 32 threads.
8. Archivers – Distributed ledger storage
Archivers are the Solana validators that offload the data to a network from nodes. Archiver nodes are simple laptops or PCs that the network uses to store data.
What is the mechanism of Solana?
With a network of 200 unique nodes and a throughput of 50,000 TPS when running on GPUs, Solana is considered one of the most high-performance permissionless blockchains on the market. Furthermore, because of its unique consensus architecture, the network can achieve this.
Like Cardano and Tron, Solana has a proof-of-stake (PoS) consensus architecture, but it is reinforced by Tower BFT consensus. Despite potential attacks from malicious nodes, tower consensus allows the network to attain an agreement.
Through evidence of history, Tower BFT imposes a universal source of time across the network. As a permanent reference for the nodes running the network, this generates a shared record of all the blockchains’ transactions and events.
PoH, one of Solana’s core inventions, is frequently misunderstood as a consensus mechanism; instead, it is a globally available, permissionless source of time on the blockchain that operates before the network reaches consensus. Proof of history is not an anti-Sybil technique or a consensus protocol. Instead, it’s a decentralized clock that aids with blockchain security.
Because the timestamps of prior transactions do not need to be processed, Tower BFT uses this permissionless clock to decrease the processing power required for transactions. This is one of the factors that allows Solana to have such a high throughput.
By enabling parallel intelligent contract runtime, Sealevel, Solana’s transaction parallelization engine, also plays a key role. As a result, the network’s resource utilization is optimized, and horizontal scaling between GPUs and SSDs is enabled.
Gulf Stream, Solana’s mempool system (memory contraction and pool), is also distinct from other popular blockchains. It sends transactions to validators before the initial batch of transactions has even been completed. This mempool-less transaction forwarding protocol enhances the network’s concurrent and parallel transaction capacity as well as transaction confirmation speed.