Solana’s Network Crashed This Week, But Developers Say Altcoin DeFi Still On Track To Succeed As An Ethereum Alternative | Currency News | Financial and business news
- Solana attracted developers as a faster and cheaper blockchain than Ethereum.
- The founder of a large Solana-based project said he was not discouraged by the grid outage earlier this week.
- Insider also spoke with a partner of a crypto investment fund, who sees a “multi-chain world” where solana, ethereum, and other networks coexist.
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Michael Wagner has big ambitions for his blockchain-based multiplayer game, Star Atlas. He sees his product in beta stage where players explore space ultimately turn into a “metaverse” and told Insider that he wants the user base to expand to “the entire world population.” .
A game that can support this kind of user base needs a web-scale, scalable, and inexpensive Layer 1 blockchain protocol, Wagner said. This is why he and his team chose to build Star Atlas on solana in August 2020, joining around twenty other projects that had been built on the blockchain.
A year later, Wagner says there are over 500 projects built on the network, and solana’s SOL token has soared to over $ 150, posting a gain of nearly 8300% since the start of the year.
The gain was in part due to developers like Wagner, who were looking for a network that could process transactions faster and cheaper than Ethereum, the blockchain where most decentralized projects currently exist.
While solana was processing 2,000 transactions per second on Friday, ethereum was only processing about 14, and although each transaction costs around $ 5 on ethereum, solana offers transaction fees of less than a dime.
Developer interest and activity in solana has grown so much in recent months that the network transaction load peaked on September 14, resulting in an outage of more than 17 hours. The company said “intermittent instability” disrupted some services on Tuesday, after Solana’s transaction load peaked at 400,000 transactions per second.
The network is back up and running, and Wagner said he was not discouraged by the outage, but rather impressed with the network’s âresolution opportunityâ.
âSolana was able to handle over 400,000 transactions per second before the failure, which is quickly resolved,â said Wagner. “It demonstrates the true potential of a scalable blockchain on the web and strengthens my determination to create Star Atlas with solana as the base protocol.”
Following the outage, investors may wonder where Solana will fit into the Layer 1 blockchain ecosystem, especially as Ethereum is the dominant platform for decentralized applications.
Seth Ginns, managing partner of investment firm CoinFund, sees a “multi-blockchain world”, where developers examine the tradeoffs of each protocol and choose to build their project on the blockchain that best provides them with what they need .
Traditional financial applications that require fast transaction speeds are a good fit for Solana, Ginns told Insider. Meanwhile, apps that require strong censorship resistance or a more decentralized protocol may be better suited on Ethereum, he said.
Ethereum will soon undergo a massive upgrade known as âEthereum 2.0,â which will result in the transformation of the blockchain into a proof-of-stake concept, among other technical updates. It might change the way it compares to solana, Ginns said, but ahead of this upgrade, developers are flocking to what works for them.
âBoth from a usage standpoint and from an investor awareness standpoint, we’re seeing that solana really holds one of the top positions among the base layers,â Ginns said. “This will likely remain the case, even if Ethereum undergoes upgrades.”
However, he noted that the solana is still only a fraction of the value of Ethereum’s network and that the token is unlikely to dethrone the second largest cryptocurrency anytime soon.
âWe have a saying, ‘you never bet against Ethereum’,â Ginns said. “It would be surprising to me if you ever heard me cancel Ethereum completely. It just has such a vibrant developer community.”