The future of how money will be used and distributed is becoming ever clearer as we begin to see the continued growth and adoption of decentralized finance, or DeFi, as it's more popularly known. However, we are also beginning to unravel more of the limitations around major blockchains, such as Ethereum, that power the many applications and platforms that offer DeFi services through issues such as poor scalability, lengthy confirmation times, and high transaction fees.
This, then, is where Solana comes in to not only solve these obstacles but offers more in return with the ability to extract greater potential from decentralization. Solana is a high-throughput, single-layer blockchain with breakthrough innovations that focuses on building greatly scalable blockchain infrastructures without sacrificing network security or the principles of decentralization.
In return, this helps to support more growth-centric and high-frequency applications that would normally cripple other blockchains while also retaining both a trust-less and permission-less distributed protocol.
The token that fuels this powerful network is SOL, and if you read on, you'll find that our Solana price prediction forecasts a very bright future underpinned by continued robust adoption, thus making it a worthy contender to add to your portfolio.
Solana Historical Price Analysis
Since its inception, Solana had run five different funding rounds for its SOL tokens, with four private sales. Its first seed funding round was held on April 5th, 2018, which raised $3.17-million. This later culminated in two separate Series A funding rounds announced on July 9th, 2018, that raised nearly $20-million from major investment funds and venture capital firms. Two more sales were held in February and March 2020 that raised another $4-million in total.
Solana's SOL tokens are among the newest cryptocurrency projects launched recently, with the earliest trading data from April 10th, 2020, according to CoinMarketCap. As such, you should always be extra cautious when moving into a newly broken-in market. Not long after it had begun trading publicly, SOL bottomed out to an all-time low of $0.5052 on May 11th, 2020.
However, it did not take SOL long to start rising parabolically around mid-2020, before then topping an all-time high of $4.9400 on September 1st, 2020.
Current Price, Market Cap, & Supply Details.
Since reaching its all-time highs, SOL has since corrected back downwards, before once again speedily rising in late-December, 2020. At the time of writing (January 15th, 2021), the price of SOL stands at $3.3600, which marks a 24-hour drop of 0.86%.
According to Messari's data, if you had bought SOL during its public sale in 2020 for $0.2200 per token – albeit the first seed round in 2018 priced SOL at just $0.0400 – you would've gained a staggering return-on-investment of 1,427.27%.
Compared to its trading value, today's price of SOL would be just 32.08% down from its all-time high and an impressive 564.81% gain from its all-time low. SOL has been designed as a deflationary asset, being capped with a total supply of 500,000,000 SOL. However, Solana has also programmed in a burn algorithm to reduce its total supply, thus reducing its total circulation to 488,630,611 SOL as of writing.
The current circulating supply is 261,900,137 SOL, which would value Solana's market cap at $879,539,929, making it the 44th-most valuable cryptocurrency.
Solana (SOL) Future Price Forecast Predictions
Although a very nascent project, 2020 has been an explosive year for Solana, having already been chosen as the blockchain of choice for a rising number of decentralized platforms, especially in the DeFi sector. Solana is projected to follow up its spectacular growth in 2021 and beyond, as other scalable solutions such as the impending ETH 2.0 upgrade for Ethereum has not yet gained full functionality. As such, our Solana price prediction is forecasting a very bullish future.
Solana Price Prediction 2021
We've been able to aggregate together a very bullish sentiment from available algorithmic models based on technical factors around Solana's SOL tokens. Seeing how much attention has been drawn towards decentralized financial platforms, having just swelled to $22-billion in locked value as of January 2021, Solana poses as a solid alternative to Ethereum for applications and platforms that are looking towards high growth. Consequently, we could see SOL break past its all-time high around mid-2021.
Solana Price Prediction 2023
By now, the biggest challenge against Solana is that well-established blockchains such as Ethereum or EOS would implement much-needed updates to their network to solve the plaguing scalability issues, including slow processing times and high fees. However, Solana's many innovations could still put it at a strong footing against its peers, including highly anticipated upgrades to allow better cross-chain compatibility between Solana and other blockchains powered by its SOL tokens.
Solana Price Prediction 2025
It's difficult to forecast just how much the financial world would change in four long years, but we would bet heavily that the value of decentralization will make greater headway into much of our daily lives through the mainstream adoption of decentralized finance (DeFi) and greater deployment of decentralized apps (dAPPs). Solana's high-scalability makes it a robust future-proofing choice for platforms. Being the native currency of this versatile and powerful blockchain makes SOL a very enticing investment opportunity.
Is Solana A Good Investment?
As our Solana price prediction forecast has shown, Solana's SOL has a very strong technical basis owing to its high-usability as a utility token and its long-term deflationary economic model to attain greater value through scarcity. SOL is a great value proposition if you're planning to add it to your basket, but you should also be cautious about moving into SOL's young and still immature market. Even looking back towards a more fundamental viewpoint, Solana's project has introduced ground-breaking solutions to solve the major challenges of scaling upwards.
For the first time, we have a decentralized blockchain network that could theoretically support large mainstream platforms of today if they make the switch and enterprise-grade services while still keeping robust security, swift processing, and low costs. Solana's single-layer blockchain runs a delegated-Proof-of-Stake (dPoS) consensus algorithm but combined with a revolutionary scaling solution through a decentralized “clock,” called Proof-of-History (PoH).
This allows Solana's blockchain to process over 50,000 transactions every second, with a very low 400ms block-time and at an equally low cost of just $0.00001 in fees for every transaction.
Solana's network is being secured by 488 node validators around the world and having processed over 5.5-billion unique transactions since March 2020. Solana's blockchain is very versatile in being able to support a wide variety of different services that can be created easily using popular coding languages. It's major use case is currently within the DeFi sector, being able to power and secure wallets, marketplaces, exchanges, payments platforms, prediction markets, lending or borrowing services, decentralized cloud providers, data storage, and much more.
Solana is also seeing increased interest in being used as the foundation to many Web3 platforms. There are currently 68 projects running on Solana's blockchain or are partnered with Solana to share and co-develop new technologies. Most of them are prominent names in the blockchain space. Large-cap stablecoins like Tether and Circle's USDC are both using Solana as one of the blockchains that secure their expansive network. Chainlink has also partnered with Solana to develop a secure high-speed oracle to power binary options trading.
Solana's biggest oncoming network update, Wormhole, also widens the usability of Solana's SOL-powered blockchain. It is a decentralized “bridge” that allows users to easily transfer assets between Solana and other chains, such as Ethereum. This means that DeFi platforms could take advantage of Solana's high-speed, low-cost, and scalable blockchain while still conducting settlements to be done elsewhere. This cross-chain interoperability would bring greater adoption for SOL and subsequent growth in value.
How To Buy Solana?
Node validators earn SOL tokens for helping to power and secure Solana's blockchain. As the native currency, smart contract executions and transaction fees are paid in SOL. Owing to Solana's deflationary economic model, token holders are encouraged to stake SOL tokens to benefit from increased scarcity while also securing the network.
The nascent SOL tokens are harder to find for outsiders and are only supported on a few exchanges, most prominently Binance, OKEx, FTX, MXC, and Bithumb. You may find the comprehensive list of supported marketplaces with sites like CoinMarketCap, or CoinGecko.
More Information About Solana
Founded by pioneering veterans in the technology sector from the likes of Intel, Qualcomm, Dropbox, and more, Solana offers a blockchain network that boasts high-throughput, scalability, and low fees, while only using a single layer for greater composability between projects on its ecosystem. Solana's most well-known and disruptive innovation in the blockchain space is the creation and wide-scale implementation of Proof-of-History (PoH). The main challenge in decentralized or distributed networks is finding an agreement on the specific time and place where transactions occur.
Solana's PoH uses Verifiable Delay Functions (VDF) to allow each node to issue locally-generated timestamps through SHA256, thus producing a synchronized and agreeable “clock” across the entire network. The result is the distribution of uniformed timestamps, allowing the processing of data to be far more efficient. This results in Solana's promise of far greater scalability than other competing blockchains while also making it harder for ASICs to “attack” its blockchain.
Solana lists seven other major innovations as a part of its overall solution to address the issues that plague traditional blockchain networks when deployed on a large-scale:
• Tower Byzantine Fault Tolerance (BFT) Consensus Mechanism – Solana has implemented a PoH-optimised version of the byzantine-fault-tolerance (BFT). It utilizes the synchronized “clock” on the Solana blockchain before consensus voting to reduce the overhead and latency for communication, and network-wide coordination. Once validators agree on voting for an order of transactions, it will become canonicalized, and cannot be rolled back.
• Turbine – Solana uses a unique block propagation protocol called ‘Turbine,' which can support a high number of nodes operating on its network without affecting performance. Instead of one node transmitting data in full to all other nodes, the data would be broken up into small packets. It would transmit those packets to each validator, which will then pass it on to a group of other nodes at once. It allows for blocks of data to be reconstructed even with a partial packet.
• Gulf Stream – Solana uses ‘Gulf Stream' as a Mempool-less transaction forwarding protocol, allowing node validators the ability to execute transactions faster, reduce confirmation times, and reduce the memory bandwidth for validators.
• Sealevel – Solana's adoption of Sealevel makes it the world's first parallel smart contracts run-time. It supports the ability of parallel execution of transactions within Solana's single-layer architecture. Sealevel finds all non-overlapping transactions within a block and executes them in parallel to further optimize performance on the Solana blockchain.
• Pipeline – Pipeline is Solana's transaction processing unit for data validation. It adopts an optimization mechanism in CPU design known as ‘pipelining', where data needs to be verified based on a sequence of steps, with differing hardware to manage each one. This allows data validation to be done more efficiently and makes greater use of available hardware.
• Cloudbreak – Solana uses Cloudbreak to solve the issue of keeping track of accounts on a distributed network, without a loss in network performance due to a lack of memory size or limited access speeds. Cloudbreak utilizes concurred reads and writes across a RAID 0 configuration on solid-state drives (SSDs).
• Archivers – Data storage on the Solana blockchain is offloaded from validators to a network of nodes called ‘Archivers.' Any data that's been processed is distributed and dispersed between the nodes, ensuring greater security within the network, and that data is kept in a decentralized ledger.
DeFi has exploded into the scene from near naught just a few years ago. After long and continued control by large banks and institutions, we could finally see the beginning of democratization in the financial industry. DeFi is primed and ready to be the future of how mankind will interact with financial services, providing accessible, low-cost, transparent, and fair access for everyone. But as with anything in life, taking steps towards the future means that one will eventually come across a few stumbling blocks.
Blockchain has had more than a few hiccups in its brief existence thus far, and we'll no doubt face more in the future. But in the here and now, there are still major challenges that prevent large-scale adoption and integration. Solana's inventive blockchain aims to solve all that by providing a network that offers speed, scalability, and cost-effectiveness without losing any of the core values that make decentralized blockchains what they are. As is already obvious in our Solana price prediction, there's a very hopeful future to come for this young project.