Is Solana Worth Buying in 2021?
Is SOLANA worth buying in 2021? This is one of the most common questions we get asked, especially after Solana’s recent bull run.
Whether or not you consider SOLANA a worthy buy depends on your financial goals and investment strategy.
How do you decide if a coin will be worth something in the future? Should you base your decision on the blockchain technology it uses, its current price and whether there are more people willing to buy than sell? Should you just go by its price history and decide whether it's cheap?
The short answer is, there are several things you will need to factor in before deciding whether Solana is worth buying or not. These include:
- The underlying technology
- Solana’s price history
- The team behind Solana
Of course, you can’t depend on any one of these factors alone to decide whether to buy Solana or not. Usually, you need a combination of several factors to make a more educated decision.
We will be looking at these factors in more detail throughout this article in a bit to understand how they inform your purchasing decision.
Before that, let’s quickly have a refresher of what exactly Solana is and why it is important to the cryptocurrency industry.
What is Solana (SOL)?
Solana aims to be the fastest, most secure blockchain in the world. To accomplish this, it implements what it calls a "Proof of History" consensus algorithm. This algorithm stores every transaction on all nodes and uses that data to create an optimized Proof of Work (PoW) curve that increases throughput as more network users join.
The algorithm creates a blockchain that is secure and scalable at the same time. It does this because, unlike other blockchains, every node has all of the data from all of the transactions on the network. This means an attacker would have to take over 51% of nodes in order to compromise security or validity. This is impossible due to the fact that there is theoretically an unlimited number of nodes on the network.
Using a "Proof of History" technique gives Solana extremely fast block times. The algorithm is optimized to only store transactions that have higher values and discard the rest. This means that more transactions can fit into blocks at once while still guaranteeing security.
Overall, Solana has a unique method of tackling the blockchain "trilemma" that most projects have failed at. Most blockchain projects choose to sacrifice either security or decentralization in order to gain speed and scalability. Solana aims to be a blockchain that can have all three.
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Why is Solana so Popular Right Now?
Solana is a relatively new blockchain that has not been in the spotlight for very long.
Despite this, Solana's price has risen from as low as $0.5052 to more than $150 per token in just a year.
This dramatic rise makes it one of the hottest projects out there and also one of the most talked about.
Many investors are also excited about Solana because they believe it has what it takes to solve the blockchain trilemma.
This is a huge advantage over other projects that are trying to make their way in the world of blockchain and cryptocurrency by using the already established infrastructure.
In addition to this, Solana's price went up when it was listed on major exchanges like Binance.
This is also because Binance Coin (BNB) holders received a discount when trading SOL for the first time on that exchange.
All these reasons speak to how popular Solana has become in such a short space of time, which is why many investors are rushing into this exciting project.
Is SOLANA (SOL) Worth Buying in 2021?
So, should you buy Solana right now? That is the million-dollar question.
To answer it, let's look at Solana on the macro level. You can see that since its inception, SOL has been consistently climbing through the ranks of all cryptocurrencies by market cap to currently be sitting in #7.
If you buy Solana now, there is a very good chance that you will see similar returns to those who invested in Bitcoin or Ethereum during their early stages.
Only time will tell, but from a purely speculative standpoint, it makes sense to buy the token right now. This is because the price seems to be recovering from a recent consolidation mode and adapting a linear momentum.
The more SOL you buy, the higher your potential ROI will be.
Right now, it's all speculation, though. No one knows what Solana is truly capable of, and that's why it makes sense to only invest the much you can afford to lose.
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Why Should I Buy Solana (SOL)?
Below are some of the reasons why you might want to buy Solana:
- The price might go up again: Most price analysts predict that Solana's price might be preparing for another uptrend soon. This means that it might be a good time to buy in before the price goes up further.
- The team is visionary: The team behind Solana has delivered on what it promised so far. It has a proven track record and an impressive lineup of advisors.
- The technology is revolutionary: Solana has managed to achieve what other blockchain projects failed to do: implementing a unique consensus mechanism that guarantees network security, honest ordering and scaling to an unbounded number of transactions per second while still retaining decentralization.
- It has many use cases: Solana can be used for many different applications, including dApps, games, smart contracts and IoT. This means that there is a lot of room for growth in the future as more people are starting to discover blockchain technology and what it has to offer.
- The community is strong: Solana has a strong community across all social media platforms. This means that you get all the support you need including free investment advice from community members.
Risks Associated with Solana Investment
There are some risks associated with buying Solana. These include:
- Solana might not be able to compete with more established blockchain networks: Although Solana seems to be one of the top projects out there, it still has a long way to go. There are already many blockchains that have been around for quite some time and have larger communities than Solana has. This means that although its technology is strong, its price growth might be limited.
- Lack of long-term history: Since this is a new cryptocurrency with such a big potential to grow, nobody really knows what the future holds. In fact, Solana has only been around since March 2020.
- There are few details on how they will scale, how each node will verify transactions and maintain security with increasing nodes, etc.
This means that you should only invest in SOL if you're an advanced cryptocurrency trader who understands the risks involved.
If you don't know what you're doing, then do some research on the project first before jumping in headfirst.
Conclusion: Is Solana (SOL) Worth Buying?
Solana was built to solve the blockchain trilemma, a point where blockchains are secure, decentralized and scalable simultaneously. Solana is also developing a new consensus algorithm called Proof of History that will allow the network to be faster, more transparent while ensuring it remains decentralized and trustless.
Solana has already made good progress with its project and is now among the top 20 cryptocurrencies by market cap. The team has a proven track record, and the community is growing steadily as well. This only shows that the team is working hard, and everyone in the community should expect high growth rates from this project in the future.
So yes, Solana is definitely worth adding to your portfolio.
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