Investing in Solana Cryptocurrency – Solana is a decentralized cryptocurrency and blockchain-based platform that aims to scale the number of transactions per second on a blockchain to 50,000+. The project began in 2017 and is led by Anatoly Yakovenko, an entrepreneur who previously worked as an engineer at Qualcomm.
The scheme is based in San Francisco and was initially funded by private capital. It does not have its blockchain but instead uses the Ethereum EVM (Ethereum Virtual Machine) for smart contracts. Solana describes itself as a “high-performance blockchain,” which means it’s built from the ground up with performance in mind.
If you are considering investing in SOL, you’ll need to know a few things first. Here is a detailed article on what Solana is and everything related to it.
What Is Solana?
To begin with, let’s define what is SOL as a cryptocurrency. Cryptocurrencies are digital currencies that can be used as a medium of exchange between parties in a transaction. SOL is an example of such a digital currency and is based on blockchain technology.
What distinguishes SOL from traditional fiat currencies is that it is decentralized—that is, any government or central authority doesn’t control it. This means that the issuance and distribution of the currency are not governed by any centralized power but rather designed to be inflation-resistance and censorship-resistant.
By being censorship-resistant, this means you can use SOL without having to worry about it being blocked or shut down at any point in time.
How to Buy Solana (SOL)?
If you’re wondering how to buy SOL, you’ll need to go through a broker or crypto exchange. As of now, there are five main ways to buy SOL:
- Using a crypto exchange, such as Bitfinex, Coinbase Pro, Kraken and Binance. This requires a user account with the selected platform and an appropriate wallet to store your funds.
- Using a peer-to-peer network such as LocalBitcoins or Bisq. The advantage here is that you’re dealing directly with another person, cutting out the “middleman” that is a traditional exchange. But, there are several disadvantages as well like you have no recourse if something goes wrong with your order.
- Through a non-custodial exchange such as HodlHodl or OpenDEX allows users to directly interact on their platform without putting any trust in the company behind it. The only thing required to create an account is an email address and password.
- Use a credit card at Coinbase or Cex.io. This method of payment will typically incur high fees compared to other methods and comes with higher risk due to potential fraud on behalf of the customer purchasing coins or tokens via credit card, so be sure not to overcharge yourself just because it’s convenient.
- Use bank transfers at exchanges like Gemini or Luno, which require only an email address. Password is required if using Android devices but not iOS devices.
What Can You Do With SOL?
As a cryptocurrency, SOL is an asset that can be bought and sold on exchanges. It’s also possible to use SOL to pay for products and services provided by merchants who accept the coin. Some retailers will allow you to trade SOL for other cryptocurrencies or fiat currencies like dollars or euros. If you hold SOL—a practice known as HODLing—you may also be able to earn interest on your holdings.
On the Solana blockchain, users pay transaction fees in SOL. So long as people continue using the network, there should continue to be demand for this currency. In addition, many cryptocurrencies are designed in such a way that supply is limited; the total number of coins available will never exceed a certain amount.
This means that if demand increases but supply stays the same (or decreases), the value of each coin could go up over time due to simple market forces such as supply and demand.
How to Store SOL?
The first obsession to know is that, like most cryptocurrencies, SOL is not a physical currency; it’s a digital token. This means if you’re interested in investing in this currency, you’ll need a digital wallet to keep your tokens safe. Wallets divide into three categories: hot wallets (connected to the internet), cold wallets (not connected to the internet), and hardware wallets (physical devices).
Each of these type of wallets has its pros and cons. For example, hot wallets are very convenient because they allow users to store their crypto online so that it can easily transfer or use for spending. However, they also come with security risks because they’re vulnerable to hackers.
If you go with one of these options—hot, cold, or hardware—you can consider using one of the recommended Solana cryptocurrency wallets. These include SolFlare (hot web wallet), Solana Wallet (hot mobile wallet), Ledger Nano S (hardware wallet), and Trezor One (hardware wallet).
Is Solana a Good Investment?
The main question most populace want to know when it comes to crypto investing is whether Solana is a good investment and why should I buy SOL?
First, let’s answer the question of what makes a cryptocurrency a good investment. When analyzing any cryptocurrency, you can break your research down into two different areas: its technology and the market cap. Solana has very strong blockchain technology that could be worth exploring if you are looking for an opportunity to spend in a project with potential long-term value.
The second area of analysis is market cap. Before you choose whether or not to invest in Solana, it’s important to understand how crypto projects value and what that actual number means for investors.
Bottomline
It’s a good idea to do some investigate before investing in any cryptocurrency. But it’s especially important when considering Solana, which is still relatively new and getting a lot of attention. Solana is a high throughput blockchain platform that claims to have achieved over 50,000 transactions per second on its testnet.
The project is also increasingly refer to as the “Ethereum Killer” due to the protocol’s proposed scalability advantages over Ethereum. If you are looking for an asset with potential, Solana could be worth considering.