The last half of 2021 was incredible for Solana. The digital currency has been red hot since then, so it is not surprising that many are adding it to their cryptocurrency portfolio.
As an experienced cryptocurrency trader/investor, you should know that investing in trendy coins can be very rewarding, yet, it is considered a risky endeavour. To minimize your risks and improve your chances of making a reasonable profit, you must research every coin before investing.
So, what is Solana? Should you invest in Solana (SOL)? And where can you buy Solana? Depending on your approach to investing, you may have many more questions regarding Solana as an investment option. Here, we are going to answer important questions that can help you make the right decision about Solana.
Before we delve fully into the topic, it is important to state that we may not tell you to invest in Solana or avoid it. We are going to discuss the cryptocurrency in an honest manner and allow you to make your decision. Therefore, it is important that you read every part of this post carefully. In the end, you should have adequate information to make a sound decision.
Content
- What Is Solana?
- A Brief History of Solana
- What Is Special About Solana?
- More about Solana Token
- Should You Invest In Solana?
- Is Solana A Safe Investment?
- Major Reasons to Invest In Solana
- Reasons to Reconsider Investing In Solana
- Where Can You Buy Solana?
- Best Platform to Buy Solana
- What Next After Buying Solana?
- Key Points to Keep In Mind
- Final Words
What Is Solana?
Solana can best be described as an open-source or programmable blockchain that provides decentralized finance services. It is one of the successful blockchain projects that seek to develop an ecosystem of cryptocurrency-powered products and services.
Like other cryptocurrency ecosystems, Solana works as a network that is tied to a digital currency that is also called Solana or SOL. It is very similar to Ethereum, one of the most important cryptocurrencies and the major backbone of the DeFi subsector. It solves key problems in the cryptocurrency universe and also allows developers to create projects that address specific problems in certain industries.
Solana has been called Ethereum-killer because of its similarities with the incredible Ethereum network. It is not the only cryptocurrency that has been described by this name, but there are real reasons why it has been accepted by many and considered a worthy alternative to Ethereum. It has an incredible protocol that facilitates decentralized apps development and other elements that make the DeFi sector a real threat to conventional financial systems.
One of the reasons Solana has won the hearts of many in the crypto universe is its innovative hybrid consensus model. The network has introduced what is known as Proof-of-History (PoH) and combines it perfectly with its Proof-of-Stake consensus. One of the primary goals of the project is to make decentralized finance accessible on a larger scale. In this regard, it improves scalability, among other beneficial properties.
Like other cryptocurrency platforms, Solana has a native currency that powers the network and facilitates transactions within and outside the blockchain. This native token (SOL) is the primary subject of this post as it is the digital asset you will decide to either buy or ignore at the end of this post. We will come back to this coin shortly.
A Brief History of Solana
Solana started as an idea in 2017, but it took a while for the team behind the project to lay a solid foundation and launch what they believe will be one of the most important networks in the crypto space.
The most important name behind Solana is Anatoly Yakovenko, a smart engineer who started his professional career with Qualcomm. After moving up the ranks rather quickly, the talented and innovative engineer moved from Qualcomm to Dropbox to serve as a software engineer.
When Yakovenko started out on a journey to create an innovative cryptocurrency platform in 2017, he teamed up with a colleague from Qualcomm, Greg Fitzgerald. They started with a project named Solana Labs. They attracted several other Qualcomm colleagues and worked tirelessly to create Solana.
The Solana ecosystem was built slowly over the course of three years (approximately). The blockchain was completed in early 2020, and the token was eventually released to the public in March 2020.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
What Is Special About Solana?
There are thousands of cryptocurrency platforms out there. To catch the attention of the public and become popular, a crypto platform must offer something valuable. Being unique is also a great way to prove relevance and remain sustainable in the crypto space. Solana has managed to do that.
As hinted earlier, one of the most remarkable things about Solana is the use of a hybrid consensus model. As an innovative platform, Solana has introduced what is known as proof-of-history consensus. The unique consensus was developed by Anatoly Yakovenko himself and combines perfectly with the popular and underlying proof-of-stake consensus of the blockchain.
Solana’s unique model offers several benefits to the platform and its users. For a start, it allows for greater scalability of the protocol. In turn, this boosts the usability of the network and improves the experience. The blockchain offers incredibly short processing times and allows for significantly decreased validation times for both smart contract execution and transaction. This has attracted several technical users in just a little over 1 year.
Another major reason Solana is regarded highly in the crypto space is the fact that it serves both small-time users and enterprise users efficiently. Though it guarantees scalability and fast processing, the network has low fees. The team has also promised users that they will not face any surprising increase in fees and taxes.
More About Solana Token
As you already know, Solana has a native token. This native currency is also called Solana and trades under the ticker symbol SOL.
SOL is to Solana what Ether is to Ethereum. It powers the network and also serves as the most important element when it comes to investing in Solana. In fact, it is the digital currency/asset a regular investor will focus on when using the network. It is an asset you can buy and sell on many cryptocurrency exchanges and other reliable platforms.
SOL is the governance token of the Solana platform. It is used in sending transactions and also for executing programs on the network. You can buy and sell SOL on some of the most popular cryptocurrency exchanges, brokerages, and reliable apps.
At the time of writing this post, Solana was trading for $14 per token. It currently has a market capitalization of $4.8 billion, making it the 10th-ranked cryptocurrency by market capitalization. The fully diluted market capitalization, however, is $49 billion. That is a lot for a coin that was launched in 2020. The circulating supply is 362,336,474.83 SOL.
Should You Invest In Solana?
From the information above, you can boldly say that Solana is one of the most remarkable coins to grace the cryptocurrency space. However, you shouldn’t make a decision based on the information alone. There are several other things to consider before investing your money.
So, should you invest in Solana (SOL)? Well, there are many things to consider and we are going to focus on the key owes. We will make it simple by discussing the major reasons to invest in the network and well as reasons to think twice before jumping on it. Before that, it is important that we discuss the security of your investment.
Is Solana A Safe Investment?
Solana or the cryptocurrency market is unpredictable for many reasons. The first thing you need to be sure of is that your investment is secure. Most platforms have several security protocols that protect investors from malicious actors and programs. Solana is one such network.
We've mentioned the unique proof-of-history consensus multiple times. It is responsible for the bulk of transaction processing in Solana, and it is a solid protocol. It is the primary factor that defines the trustless nature of the blockchain and gives investors assurance that their transactions are secured.
Solana also uses proof-of-stake (PoS) consensus. It is used as the monitoring tool for the proof-of-history processes, validating each sequence of blocks it produces and making sure that there is no way to manipulate the system. The combination of the two consensuses is considered a genius idea in the crypto space because of the level of security it offers.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Major Reasons To Invest In Solana
It is possible that you’ve already found several reasons to invest in Solana. It is still important that we discuss some major reasons to help you understand better. Here are the key reasons you may want to invest in Solana:
✅ It Has a Solid Team behind It
The quality of the team behind a cryptocurrency determines how far and how well it can go. In the case of Solana, the team is vibrant and innovative. The team has demonstrated excellence in the past and appears ready to offer more to customers. We are confident that the team is capable of taking Solana to greater heights.
✅ It Has a Unique Blockchain That Can Compete With the Bests
Solana boasts of a unique blockchain that can stand any other blockchain in the industry. It took some time to complete the project, but it was created in a manner that gives the network an edge over many other platforms. For instance, Solana is way faster than Ethereum and offers significantly lower fees.
✅ The Hybrid Consensus Model Is Awesome
We’ve mentioned that Solana has a hybrid consensus model several times. However, it is important to state here that it is one of the reasons to buy the token. The innovative combination of PoH and PoS offers several benefits to the network, including increased speed and better security.
✅ It Is Fast Becoming a Reference Network in the DeFi Scene
Solana is a part of DeFi and DeFi is fast taking over the online investment space. Being a critical part of something so big means that Solana has a very big future ahead of it. It is already one of the most valuable coins and has all it takes to climb further up the ladder of success.
✅ SOL and the NFT Mania
Non-fungible tokens can be built on the Solana network, and that is another major reason to back the cryptocurrency. There is a renewed NFT hype, and it has already benefited Solana greatly. The NFT mania is poised to last a lot longer and it will help to take Solana to the heights it can reach.
✅ It Has Notable Partners Already
One of the ways to know a cryptocurrency platform with a bright future is to consider the number of partners it has. Solana has several quality partners, thanks to its uniqueness and what it offers. One of its most recognizable partners is the fast-growing trading platform, FTX, which has already created a decentralized derivatives exchange on Solana. There are several other important partners and they will certainly help to grow the network.
✅ It Offers Ultra-Low Fees
One of the ways a cryptocurrency platform can attract new users and partners is to offer competitive fees. Solana takes several steps further to offer fees that can best be described as ultra-low. This attracts all kinds of users and helps to grow the network faster. Low fees also mean investors and traders record larger profit margins.
✅ SOL Has Performed Wonders
The performance of the native currency of the Solana network can best be described as exceptional. It has grown so big in such a short time that many are beginning to doubt its ability to sustain growth. SOL has displaced coins that have been around for several years to become the 10th-ranked cryptocurrency in the world. Such performance can only come from a cryptocurrency that will succeed beyond expectations.
✅ It Is Set To Experience More Dramatic Growth
Already, Solana’s growth has been nothing short of astonishing. However, there are indications that SOL will gain more value in the near future. Solana, as a cryptocurrency platform, is set to grow as developers continue to create more impactful projects on it. There are just so many wonderful things going on for the platform that we feel it will explode even more before the end of the year.
✅ It Is Unlikely That Liquidity Will Ever Be an Issue
Solana currently has a high trading volume, which shows that people are buying. It is likely that this will continue to grow because there are more successful projects coming up on the network. Investors will be able to liquidate their assets whenever they want.
Reasons To Reconsider Investing In Solana
Solana fans will tell you that there is no reason to think twice about investing in the coin. You may be tempted to say the same after reading to this point. However, there is always a reason to think twice when it comes to investing your money.
Solana is an incredible network and the native currency is performing well. But then, it is a crypto and you need to be careful, especially if you are not an experienced trader or investor. Here are some of the reasons you may want to reconsider investing in Solana right now:
❌ SOL Has Shown Signs of Extreme Volatility
SOL, the native currency of Solana, has grown so much in the past few months that it has become easy for even the keenest observer to neglect the fact that it is a volatile asset. In fact, it has shown signs of extreme volatility. This can be a big problem, especially for day traders. Volatility brings lots of risks to the market, and SOL is very volatile.
❌ Solana Is Still a New Cryptocurrency
It is always better to invest in a tested and trusted cryptocurrency. Unfortunately, those words cannot really be used to qualify Solana. It is a relatively new cryptocurrency, though it has grown rapidly. Though Solana has achieved a lot and earned the trust of several experienced partners, it is still important that you trade with caution.
❌ Solana Faces Competition from Many Other Incredible Platforms
Solana is a wonderful network, but it is not the only platform that offers DeFi services. In fact, it is one of those that came to the show late. Besides Ethereum, Solana also faces competitions from Cardano, NEO, QTUM, Ethereum Classic, Fantom, and more. These are all great platforms that can give Solana a run for its money.
Where Can You Buy Solana?
Buying a cryptocurrency is very simple – at least, that is what most people will tell you. If you are an experienced trader or investor, this may be the reality for you. Beginners, however, may fall victim to online scams while trying to buy cryptocurrencies. It is important, therefore, that we discuss your options when it comes to buying Solana.
Like most other top cryptocurrencies, Solana is available across a wide variety of online platforms. The commonest place to buy is a cryptocurrency exchange. In top exchanges like Binance and Coinbase, you can buy Solana with ease. You also have several options when it comes to paying for the token – you can pay with fiat currency like the dollar or other top cryptocurrencies like Bitcoin and Ethereum.
It is also possible to buy Solana through a stockbroker. There are a few brokerages that make cryptocurrencies available to their users. Many experienced investors choose to invest through exchanges for security reasons and more. One of the most popular brokerages for cryptocurrencies is eToro, and Solana is available on the platform.
It is also possible to buy cryptocurrencies from apps that are neither official cryptocurrency exchanges nor brokerages. Some of these apps are run by reputable organizations that are fully committed to cryptocurrency investments. Some, however, are run by people with questionable backgrounds. It is quite risky to buy from such platforms.
Best Platform To Buy Solana
It is difficult to point at any platform as the best place to buy Solana, but there are qualities you must look out for when choosing a platform to buy a digital token. The first important thing to consider is the security of your investment. You want to make sure that you are not buying from a place where there is any chance of you getting scammed or hacked.
Cryptocurrency exchanges are great for several reasons, but it is risky to completely trust an exchange, especially when it comes to safeguarding your investment. Some of the best exchanges have been hacked in the past.
Regular cryptocurrency apps and investment platforms are even riskier. Though some are genuine, many unofficial apps are run by con artists who are trying to steal people's money all in the name of investing in cryptos.
Without mincing words, we can say that the most reliable way to buy a cryptocurrency is through a brokerage. Many brokerages list some of the best cryptocurrencies for their users and offer several other benefits. eToro is definitely one of the best platforms to buy a cryptocurrency, and Solana is available for eToro users.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
What Next After Buying Solana?
Buying a cryptocurrency is just one of the important steps in profitable cryptocurrency investing. You will need to keep your digital assets for a while before selling. Depending on your investment strategy, the length of time will vary significantly. But how can you make sure that your assets are stored safely?
Digital wallets are used to store crypto assets and they are generally safe. However, there are important things you must consider before choosing a digital wallet for a valuable investment like Solana. You need to consider compatibility with your intending asset portfolio, transparency, security features, privacy features, fees, user experience, and more.
If you choose to buy Solana from eToro, you may not have to bother about digital wallets (if you don’t already have a trustworthy one). eToro offers one of the most secured multi-token digital wallets in the world. Using the wallet to store your digital assets will give you peace of mind.
Key Points To Keep In Mind
We’ve discussed most of the things you need to know about Solana. We’ve also provided enough information to help you decide whether it is a decent coin for your cryptocurrency portfolio. Obviously, what we’ve covered is a lot, and there is a need to summarize. Here are key points to keep in mind:
- Solana is an incredible open-source cryptocurrency platform that has caught the attention of many in recent times.
- Solana boasts of incredible blockchain technology and many industry players have seen it for what it is.
- Solana utilizes a unique hybrid consensus model that improves scalability, security, and makes the platform a lot more efficient.
- Solana has attracted several developers, and there are already many incredible projects on the network.
- Solana has attracted many notable partners and the partnerships have already started yielding fruits.
- Solana has a fast-growing ecosystem that is well-positioned to become one of the best in the cryptocurrency universe.
- SOL (the Solana token) has performed wonders on the market in just a year and a few months after was released to the public (it is now the 10th-ranked cryptocurrency by market capitalization).
- Solana is poised to break new grounds and the token (SOL) is well-positioned to become one of the most valuable digital currencies on the market.
- Solana is a new coin and a volatile one too, so it is important that you play the investment game with caution.
- There are several places you can buy Solana but eToro is one of the most reliable platforms.
- eToro offers its users several benefits, including access to a top digital wallet that makes investing safer and more profitable.
Final Words
Solana is currently making waves in the cryptocurrency universe for the right reasons. It has been called Ethereum-killer and there are good chances that it will give Ethereum a good run for its money.
From all indications, investing in Solana will be great for most people. The platform is superb and the token has already performed wonders. Solana is set to explode even further and those who can invest now stand a good chance of making reasonable profits from their investments. At the same time, Solana has shown signs of extreme volatility, which means it may not be the best investment vehicle for a certain group of people.
The decision to invest or not to invest in Solana is all yours. We’ve provided the information you need to make the decision and hope that you can use them to make the right decision. Remember that it is important to research properly before buying any digital currency. Remember, also, that taking the right courses can help you sharpen your online trading skills and boost your chances of succeeding as a cryptocurrency investor.
eToro – Best Cryptocurrency Platform
eToro have proven themselves trustworthy within the Crypto industry over many years – we recommend you try them out.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Do you need more information or professional help about investing in Solana or any other asset? Contact us and we will be happy to help.
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How To Buy Solana - Beginner's Guide