Solana's Quest for Decongestion
Can the once high-flying chain recover?
Even the crypto-tourists have heard of Solana at this point. The new-age chain known for lightening speed, cheap fees, slick NFTs and an absolutely stratospheric price run in 2021.
2022 has been humbling.
Alongside the dramatic tightening of financial conditions which have cratered “risk-on” assets globally, Solana has been plagued by internal congestion issues.
The one-two punch of rising rates and downtime have laid Solana low, crashing ~85% from its November 2021 high.
Several times since its rise to provenance, Solana has “gone down” for hours at a time. A cardinal sin for blockchain purists. The frequency of issues appears to be accelerating in 2022 as the Solana core team and community fight tirelessly to fend off the bots flooding the world’s cheapest network.
Can Solana solve these issues and return to glory much like Ethereum did this past cycle? Can it recover the trust of users and developers and retake leadership of what is potentially the largest addressable market of the decade (Layer 1 smart contract platforms)?
Our new research head Vince Torrell dives into the weeds to unpack the issues plaguing Solana and solutions the team is and should consider.
Disclaimer: blockchain scaling and decongestion are hard problems. As such, diagnosing the issues and proposing solutions can be a bit technical and this report leans in that direction.
Solana’s Quest for Decongestion:
Key Insights
Solana has suffered chronic service degradation due to unreasonably cheap fees and opportunist bots chasing NFT trades
Transaction rates appear to have been mostly saturated until recently
Exogenous fee hikes have temporarily stemmed the tide of spam but don’t obviate more robust fixes to the chain itself
IP address spoofing is soon to be squelched by a protocol change
Congestion fees are being designed which attempt to respond with wallet granularity
Block broadcasts are being optimized to reduce latency
Virtual machines might soon be charged for wasting resources during partial program executions
Trivial “dust” staking is to be banned
History deletion is under consideration for blockchain truncation
The Full Report: Solana’s Quest for Decongestion