2021 was a booming year for cryptocurrency. There was an increase in investors trying their luck in crypto investments. Cryptocurrencies also provided their investors with a huge investment return during the year. Today, we’re going to take a look at Solana.
This year, we saw a few small-time players gaining big in the market. While bitcoin continues to rule the market, other players benefitted this year.
This includes Ethereum, Solana, and Polkadot, to name a few.
While Ethereum is considered a competitor to Bitcoin, Solana gets the name of being a competitor to Ethereum.
Solana and its performance in 2021
Solana provided huge returns to its investors in 2021. The prices started going up in June. By the end of December 2021, Solana had provided its investors with more than 13000% returns. The year started with Solana’s market capitalization at $86 million.
But, today, Solana has a market capitalization of $64 billion. On Jan 1, Solana priced at $1.51 and ended at $248 at the end of 2021. Solana today takes the fourth position in the crypto market. You can trade or invest in at bitcoin revolution.
There is a growing community interested in investing in Solana. Compared to its competitors like Ethereum and Bitcoin. Despite these profits, it is important to note that Solana is a newcomer in this industry.
There are a relatively high amount of risks associated with this investment model. If you have a high appetite for risks, then Solana is your best bet for 2022.
Let us look at the pros and cons before investing in Solana –
Share price shows an upward trend
Since January 2021, Solana’s price has shown an upward trend. The price of Solana went up to $212 in September 2021. An important point to note is that Solana was priced at $1.50 in January 2021. Solana’s method of adopting decentralized finance helped in the price surge. This also helped Solana take its position amongst the top ten cryptos globally.
Better transaction speed and minimal fees
This is another key advantage of Solana. Solana network can undertake 50,000 transactions per second. This feature makes it the best in the industry.
Another spectacular feature of Solana is the minimum fees associated with each transaction. This feature makes it stand out from other cryptos like Ethereum and Bitcoin.
These coins need complex proof-of-work model and complex calculations to confirm each transaction. Solana is different, and transactions are verified based on ownership.
This ease in verifying each transaction allows for minimal fees during a transaction. Believe it or not, Solana’s transaction fees are less than 1 cent per transaction.
Multiple applications running on the Solana network
More than 350 applications are running on the Solana network at any point. This includes applications adopting decentralized finance, decentralized applications, and non-fungible tokens.
Other than this, there are banking, gaming, and other intermediary projects. Non-fungible network and decentralized finance is the way forward. Solana has gained this advantage by deploying both this system since its launch.
Cons of investing in Solana
While Solana is gaining popularity, it is important to note that investors still doubt the possibility of network stability. Solana has reduced users as compared to Ethereum.
And there are still doubts about how the Solana network will support transactions. In September, there was a decline in Solana’s price.
The company declared that they were experiencing instability in the network and agreed that they were experiencing resource exhaustion. Their engineering experts were able to rectify the issue.
Yet, this caused prices to drop in the global market.
Possibility of Inflation
Many cryptocurrencies are limited to their production. For example, it is estimated that there will be 21 million bitcoins.
The last bitcoin is expected to be mined in 2140, and the scope of bitcoin beyond this is still not known. Solana has not put any limit on the number of coins that will be available.
They started with an 8% increase in their coins. This rate will stabilize at 15% and then reach saturation. So, if you are not interested in inflation, Solana is not your best bet.
How to buy Solana?
If you want to buy Solana, the best option will be to buy through an
authorized exchange. These exchanges help with market analysis, trends, and fluctuation.
This will also help you with building your crypto wallet.