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Is Solana a Good Investment? Our Possition in 2023

Intro to Solana.


Is Solana a Good Investment in 2023? Breaking Down Our Perspective. #cryptocurrency #crypto #cryptok #solana

♬ original sound – cryptogonemad

Key Points :

  • Considered by many as an ‘Ethereum-killer’ for its incredible transaction speed and much lower gas fees.
  • Solana is among the fastest blockchains in the market. A Layer 1 with a capacity to process 65,000 transactions per second (TPS). Fast Speed is great for Decentralized Finance, WEB3,  NFTs,  blockchain gaming, and the metaverse. To compare Ethereum ranges from 15-45 TPS.
  • In addition, Solana is one of the cheapest blockchains for crypto transfers with an average transaction fee of less than $0.001.
  • Solana is just behind ETH in regards of developers. In fact it’s the second largest cryptocurrency by active developer count. Whooping 2000 active Devs according to the latest Electric Capital report released in Jan 2023.
  • Main drawbacks, strong backing by FTX & Almeda. FTX has 50.5 million SOL tokens locked until 2028. That’s 9 % of total supply. Because of this Solana has been hit by FTX collapse big time. Below you can see what was in FTX bag.
  • Another drawbacks are and frequent network disruptions. Fxing network outages and increasing reliability and resiliency have been a core focus of the Solana engineering team in 2022, newertheless a week ago we have experienced another network outage.
  • Solana has experienced a drastic decrease in TVL in the last year amid Bear Market and the FTX fiasco. Current value locked $260 million , which dropped from 10 billion.
  • Another point of concern is high centralisation. Althrought it has 2,300 validator nodes which is pretty decent, a small portion of 30 validators control over 33% of the total network stake.
  • Even after the FTX drama, Solana has a fast-growing ecosystem of DApps . From around 300 DApps in 2021, Solana now has around 1000 DApps running on top of it, and the numbers are growing.
  • Solana is the second most popular NFT network after ETH.
  • In November Solana said with current burn rate it still has approx 30 months of runway left. So we know that Solana has enough cash on hand and should to survive this Bear market.
  • Solana is in progress to Launch of Solana Mobile, which showcases the world’s first-ever crypto phone.
  • Solana has secured partnerships with Facebook and Instagram regarding NFTs.
  • Tokenomics . Initial token allocation has been heavy on insiders which includes team, company and VCs. Once FTX is out of equation in 2028 this will look slightly better.

Our possition? Medium Exposure due to increasing amount of DEvs & DApps as well as great transcation speed and large NFT market share. After losing 92% of its value in 2022, for us Solana seems poised for a major rebound in 2023.

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