Solana’s cryptocurrency, SOL, has seen its value continually increase over the past week, reaching a new all-time high of $48.46 on Apr 25 as most top coins struggled amid the downward draft in the crypto markets.
The coin has seen gains of over 44% in the last 7 days according to CoinGecko data, which raised its market capitalization to $12.6 billion at the time of writing.
The popularity of the Solana network has been boosted by the high transaction throughput it can handle (over 65k transactions per second) and low fees.
These advantages have allowed it to position itself as an alternative to Ethereum at a time when the most popular network suffers from increased congestion and gas prices.
The network has become a major destination for popular projects like Civic, USD Coin (USDC), and Tether (USDT), which take advantage of the network to extend their platform’s cross-chain capabilities.
Solana also has its own Decentralized Finance (DeFi) platforms, which has allowed it to take advantage of the growing niche to attract investors through projects like Raydum and Serum, benefiting from the DeFi booming that has been taken place for the past year.
Three Years of Development Are Now Paying Off for Solana
The Solana cryptocurrency has launched in March of 2020 after three years of development by the Solana foundation, the Switzerland-based organization in charge of launching the project and building its infrastructure.
The blockchain network was created with the principle of providing high scalability to Crypto Apps without sacrificing speed, security, or censorship resistance. The network has already processed over 16 billion transactions and counts with over 750 global validators
Solana makes use of a proof of stake (PoS) and proof of history (PoH) consensus mechanism to reduce transaction processing times.
The network also introduced other features that made it a force to be reckoned with in the space, including Tower BFT, Turbine, Gulf Stream, Sealevel, Pipeline, Cloudbreak, and Archivers.
While the technology behind Solana is incredibly complex, these features are intended to improve block propagation times, accelerating transactions, facilitating recovery and validations, and improving the efficiency of storage in the network.
Solana has also actively incentivized developers to create new applications on top of the network by creating a grant program.
These grants give teams access not only to funding to kickstart their project but also to technical support, venture capital introduction, milestone grants, and recruiting assistance.
A Ray of Light in the Crypto Market
Very few projects at the top of the crypto ranking have shown growth over the past weeks as two different crashes have taken place, making Solana’s success a case of special interest for experts and investors.
One of the possible causes of the crash is the proposals of the American President, Joe Biden, to increase taxes on the richest citizens in the country to up to 40% to cash out of the market.
The report also affected the US Stocke markets, causing one of the biggest slides in the last 5 weeks.
According to Todd Morakis, co-founder of digital-finance product and service provider JST Capital, there is reason to think that the new US President is to blame for the selloff.
“People have been talking about the capital gains tax and US stock market selloff being the catalyst of this. If it is true we’ve moved too much — but once Bitcoin gets a head of steam it is tough to stop unless you are at a technical area.”
Over the last 7 days, Bitcoin experienced a loss of 7% in value, while other projects like XRP; DOGE, DOT, LTC; BCH, LINK, and VET suffered drops between 12 and 25%.
While the market now seems to be recovering from the latest crash, investors are keeping a specially close eye on American economic policy to prepare for any volatility that ensues.