Solana (SOL)

April 7th 2020, updated at May 23th 2020

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Solana is a high-speed single-layer blockchain , currently supporting peak capacity of 65k transactions per second and 400ms block times using a network timestamp system called Proof-of-History ("PoH").

, currently supporting peak capacity of 65k transactions per second and 400ms block times using a network timestamp system called ("PoH"). Core technical team comes from Qualcomm, a Fortune 500 chip manufacturer , where they managed projects such as Firefox OS and the BREW Operating System.

, where they managed projects such as Firefox OS and the BREW Operating System. As of the time of writing, the project has over 80 active third-party validators and over 50,000 community members across Telegram, Reddit and Twitter.

and over across Telegram, Reddit and Twitter. Solana raised over 25 MM USD from investors including Multicoin Capital, Foundation Capital, Distributed Global, Blocktower Capital, NGC Capital, and Rockaway Ventures.

1. What is Solana (SOL)?

1.1 Description of Solana

A Web-Scale Blockchain for Secure and Scalable Decentralized Apps and Marketplaces.

Founded by former Qualcomm, Intel, and Dropbox engineers in late-2017, Solana is a single-chain, delegated-Proof-of-Stake protocol whose focus is on delivering scalability without sacrificing decentralization or security.

Core to Solana's scaling solution is a decentralized clock titled Proof-of-History (PoH), built to solve the problem of time in distributed networks in where there is not a single, trusted, source of time. By using Verifiable Delay Functions, PoH allows each node to locally generate timestamps with SHA256 computations. This eliminates the need for the broadcasts of timestamps accross the network, improving overall network efficiency.

Solana’s mission is to support all high-growth and high-frequency blockchain applications, and to democratize the world’s financial systems.

At its core, Solana offers:

Scalability : Solana is capable of supporting over 50,000 transactions per second , while maintaining block times of 400 milliseconds.

: Solana is capable of supporting , while maintaining block times of 400 milliseconds. Decentralization : with the use of Turbine block propagation protocol, the platform can support thousands of nodes while remaining performant and scalable .

: with the use of Turbine block propagation protocol, the platform can support while remaining . Inexpensive execution: transactions costs on the network are estimated to cost 10 USD for 1 million transactions.

1.2 Key metrics

Token Name SOL Circulating Supply 16,350,633 SOL (3.35%) Current Total Supply* 488,634,933 SOL Initial Total Supply 500,000,000 SOL

*11,365,067 SOL tokens are burnt and removed from supply.

1.3 Solana's recent news

March 2020 : Bison Trails will support staking for the SOL token when the Solana mainnet becomes live.

: Bison Trails will support staking for the SOL token when the Solana mainnet becomes live. March 2020 : Chainlink will work with Solana to build a fast oracle system.

: Chainlink will work with Solana to build a fast oracle system. March 2020 : Akash will implement Solana's smart contracts for provisioning and settlement on its cloud services.

: Akash will implement Solana's smart contracts for provisioning and settlement on its cloud services. March 2020 : Solana will work with Dish Network, a Fortune 200 US Telco, to provide the blockchain layer for a tokenized 5G network.

: Solana will work with Dish Network, a Fortune 200 US Telco, to provide the blockchain layer for a tokenized 5G network. October 2019: it conducted a network scalability test with 200 distributed nodes over 23 regions in the world.

1.4 SOL asset use cases

SOL is the native asset of the Solana blockchain. It is used for:

Staking : Solana is in the process of enabling inflation rewards for staking the SOL token in exchange for powering and supporting the network.

: Solana is in the process of enabling inflation rewards for staking the SOL token in exchange for powering and supporting the network. Transaction fees : users can use the SOL token to pay for simple token transactions and smart-contract executions on the network.

: users can use the SOL token to pay for simple token transactions and smart-contract executions on the network. Governance: the SOL token will be used in governance voting in the future.

2. Solana's key features

Solana's highly performant blockchain is built using 8 major innovations highlighted below:

Proof of History - a clock before consensus.

- a clock before consensus. Tower Byzantine Fault Tolerance - a PoH-optimized version of PBFT.

- a PoH-optimized version of PBFT. Turbine - a block propagation protocol.

- a block propagation protocol. Gulfstream - a Mempool-less transaction forwarding protocol.

- a Mempool-less transaction forwarding protocol. Sealevel - the world’s first parallel smart contracts run-time.

- the world’s first parallel smart contracts run-time. Pipelining - a transaction processing unit for validation.

- a transaction processing unit for validation. Cloudbreak - a horizontally-scaled accounts database.

- a horizontally-scaled accounts database. Archivers - for distributed ledger storage.

2.1 Proof-of-History (PoH)

One challenge of distributed networks is finding agreement on the time and sequence in which events occurred, as nodes within the network cannot simply trust an external source of time or any timestamp that appears in a message. Solana requires all validators to constantly solve SHA256-based Verifiable Delay Functions (VDF). A VDF requires a specific number of sequential steps to evaluate, yet produces a unique output that can be efficiently and publicly verified.

The VDFs can only be solved by a single CPU core applying a particular set of sequential steps. The team notes that since for a SHA256 hash function, parallel processing is impossible without a brute force attack using 2¹²⁸ cores, it is not difficult to define exactly how long it takes to apply those steps.

Solana's specific implementation uses a sequential hash that runs over itself continuously with the previous output used as the next input. With the computational output of the current function "X", a validator will be able to calculate the output for the next function "Y". Since the computation is universal, meaning all validators need to solve the same function "X", and will be able to derive the output for the next function "Y" in around the same time, Solana is able to create a synchronized "clock" across the whole network.

The team also believes that the use of Application Specific Integrated Circuits ("ASICs") would not pose a significant threat to the current PoH design, since an ASIC device would only be within 30% faster than general purpose equipments. An attack from ASIC devices, per the Solana team, can be quickly addressed.

2.2 Tower Byzantine Fault Tolerance (BFT) Consensus Mechanism

Tower BFT leverages Solana’s PoH as a clock before consensus to reduce communication overhead and latency.

Each time a node on the network votes on a particular fork, voting is restricted to a fixed period of hashes, which is called a slot. The current network setting has around 400ms for one slot. Every 400ms, the network has a potential rollback point, but every subsequent vote doubles the amount of time that the network would have to stall before it can unroll that vote.

For instance, each validator has voted 32 times in the last 12 seconds. The vote 12 seconds ago now will have a timeout of 2³² slots, or roughly 54 years. Effectively, this vote will never be rolled back by the network. Whereas the most recent vote has a timeout of 2 slots, or about 800ms. As new blocks are added to the ledger, old blocks are increasingly likely to be confirmed because the number of slots old votes are committed to doubles every slot, or every 400ms. Tower BTF offers finality as Once ⅔ of validators have voted on some order of events, it will be canonicalized and cannot be rolled back.

The Solana mainnet is planned to operate in delegated-Proof-of-Stake (dPoS), in which token holders can participate in the block production process and earn rewards by either stake token and become a validator themselves, or delegate their tokens to validators they trust.

2.3 Turbine

Often times in a distributed system, increasing the node count will increase the amount of time necessary to propagate all the data to all nodes. Turbine is a block propagation protocol aimed to solve this issue.

With Turbine, if a node were to propagate a very large message to the 1,000 peers, it would not transmit the information 1,000 times itself. Instead, the message would be broken down into very small packets, transmitting each packet to a different validator.

In turn, each validator retransmits the packet to a group of peers that are called a neighborhood. Each neighborhood is responsible for transmitting a portion of its data to each neighborhood next to it. If each neighborhood is comprised of 200 nodes, a 3-level network, starting with a single leader at the root, can reach 40,000 validators in 2 hops.

To handle adversarial nodes who might choose not to rebroadcast data, the leader generates Reed-Solomon erasure codes. Erasure codes allow each validator to reconstruct the entire block without receiving all the packets. If the leader transmits 33% of the block’s packets as erasure codes, then the network can drop any 33% of the packets without losing the block. Leaders can also adjust this number dynamically based on network conditions.

2.4 Gulf Stream

For each block production process, the upcoming network leaders will also be determined according to their stakes. Clients and validators can forward transactions to the expected leader ahead of time. This allows validators to execute transactions ahead of time, reduce confirmation times, switch leaders faster, and reduce the memory pressure on validators from the unprocessed transaction pool.

2.5 Sealevel

Sealevel, is a hyper-parallelized transaction processing engine designed to scale horizontally across GPUs and SSDs. Note that all other blockchains are single-threaded computers. Solana is the only chain to support parallel transaction execution (not just signature verification) in a single shard.

The solution to this problem borrows heavily from an operating system driver technique called scatter-gather. Transactions specify up front what state they will read and write while executing. Sealevel is able to find all the non-overlapping transactions occurring in a block and execute them in parallel — what is called parallel execution — while optimizing how read and writes to the state are scheduled across an array of RAID 0 SSDs.

Although Sealevel itself is a VM that schedules transactions, Sealevel doesn’t actually execute transactions in the VM. Instead, Sealevel hands off transactions to be executed on hardware natively using an industry-proven bytecode called the Berkeley Packet Filter (BPF), which is designed for high-performance packet filters. This bytecode has been optimized since the early 90s, and has been deployed in production in millions of switches worldwide to handle 60 million packets per second on a 40-gigabit network in a single switch.

2.6 Pipeline

The process of transaction validation on the Solana network makes extensive use of an optimization common in CPU design called pipelining. Pipelining is an appropriate process when there is a stream of input data that needs to be processed by a sequence of steps and there’s different hardware responsible for each. This mechanism ensures that all parts of the hardware are efficiently at work all the time.

On the Solana network, the Transaction Processing Unit (TPU) progresses through data fetching at the kernel level, signature verification at the GPU level, banking at the CPU level, and writing at the kernel space. By the time the TPU starts to send blocks out to the validators, it’s already fetched in the next set of packets, verified their signatures, and begun crediting tokens.

2.7 Cloudbreak

In a distributed system, memory is used to keep track of accounts, and can struggle to maintain performance due to a lack of memory size and limited access speeds.

Therefore Cloudbreak was designed to optimize for concurrent reads and writes spread across a RAID 0 configuration of SSDs. Each additional disk adds storage capacity available to on-chain programs, while also increasing the number of concurrent reads and writes programs can perform when executing.

2.8 Archivers

On Solana, data storage is offloaded from validators to a network of nodes called Archivers. Archivers do not participate in consensus. The history of the state is broken into many pieces and erasure coded. Archivers store small parts of the state. Every so often, the network will ask the Archivers to prove that they’re storing the data they are supposed to.

3. Economics and supply

SOL is the native token of the Solana blockchain. Solana uses a delegated-Proof-of-Stake consensus algorithm that incentivizes token holders to validate transactions. As part of Solana's security design, all fees will be paid in SOL and will be burnt, reducing total supply. This deflationary mechanism to SOL supply incentivizes more token holders to stake, which results in increased network security.

Token Name SOL Token Type Native Seed Sale Token Price 0.040 USD Seed Sale Date April 5th, 2018 Amount Raised Seed Sale 3.17 MM USD Seed Sale Allocation 16.23% of total token supply Founding Sale Token Price 0.200 USD Founding Sale Date June 3rd, 2018 Amount Raised Founding Sale 12.63 MM USD Founding Sale Allocation 12.92% of total token supply Validator Sale Token Price 0.225 USD Validator Sale Date July 9th, 2019 Amount Raised Validator Sale 5.70 MM USD Validator Sale Allocation 5.18% of total token supply Strategic Sale Token Price 0.250 USD Strategic Sale Date January 2nd 2020 Amount Raised Strategic Sale 2.29 MM USD Strategic Sale Allocation 1.88% of total token supply CoinList Auction Sale Price 0.220 USD CoinList Auction Sale Date March 23rd, 2020 Amount Raised CoinList Auction Sale 1.76 MM USD CoinList Auction Sale Allocation 1.64% of total token supply

3.1 Staker Price Guarantee

Solana has implemented a staker price guarantee for users who purchase SOL tokens, register them, and stake them to secure the network. The staker price guarantee is 0.198 USD (90% of the Coinlist auction reserve price of 0.220, which was established on March 24, 2020). Further details on the Staker Price Guarantee can be found in the FAQ accompanying Solana’s CoinList auction.

Any participant in the program enjoys a guarantee for 90% (0.198 USD) of the Auction Clearing Price (0.220 USD), redeemable at any time for 12 months from the start of the registration period.

Registration requires continuous staking and KYC on CoinList within the first 3 months of the program, and is eligible for any tokens bought at any time on any exchange.

Redemptions require at least 2 days of staking, and are fulfilled in USDC or USDT. In order to redeem, tokens must be staked continuously from registration until redemption.

Currently, staking is supported using the Ledger hardware wallet. The project plans to enable Trust Wallet staking support as well.

3.2 Token supply distribution

The token supply distribution is as follows:

Seed Sale tokens comprise 16.23% of the total token supply.

tokens comprise 16.23% of the total token supply. Founding Sale tokens comprise 12.92% of the total token supply.

tokens comprise 12.92% of the total token supply. Validator Sale tokens comprise 5.18% of the total token supply.

tokens comprise 5.18% of the total token supply. Strategic Sale tokens comprise 1.88% of the total token supply.

tokens comprise 1.88% of the total token supply. CoinList Auction Sale tokens comprise 1.64% of the total token supply.

tokens comprise 1.64% of the total token supply. Team tokens comprise 12.79% of the total token supply.

tokens comprise 12.79% of the total token supply. Foundation tokens comprise 10.46% of the total token supply.

tokens comprise 10.46% of the total token supply. Community tokens comprise 38.89% of the total token supply.

SOL token distribution (%)

3.3 SOL token sale

Seed Sale overview: the Seed Sale was conducted on April 5th, 2018 for 79,290,466 SOL at a rate of 0.040 USD = 1 SOL, at an average rate of 451.34 USD = 1 ETH, and 6,600 USD = 1 BTC and raised a total of 3.17 MM USD, selling 16.23% of the total token supply. The Seed Sale was conducted in ETH, BTC, and USD, and raised a total of 762.2 ETH, 60.6 BTC, and 2,427,619 USD.

Founding Sale overview: the Founding Sale was conducted on June 3rd, 2018 for 63,151,982 SOL at a rate of 0.200 USD = 1 SOL, at an average rate of 552.96 USD = 1 ETH, and 6,290 USD = 1 BTC, and raised a total of 12.63 MM USD, selling 12.92% of the total token supply. The Founding Sale was conducted in ETH, BTC, and USD, and raised a total of 16,964.1 ETH, 15.9 BTC, and 3,149,880 USD.

Validator Sale overview: the Validator Sale was conducted on July 9th, 2019 for 25,331,653 SOL at a rate of 0.225 USD = 1 SOL, at an average rate of 220.46 USD = 1 ETH, and 9,774.97 USD = 1 BTC, and raised a total of 5.70 MM USD, selling 5.18% of the total token supply. The Validator Sale was conducted in ETH, BTC, and USD, and raised a total of 9,630.7 ETH, 20.5 BTC, and 3,374,000 USD.

Strategic Sale overview: the Strategic Sale was conducted on February 18th, 2020 for 9,175,520 SOL at a rate of 0.250 USD = 1 SOL, at an average rate of 194.48 USD = 1 ETH, and 9,376.50 USD = 1 BTC and raised a total of 2.29 MM USD, selling 1.88% of the total token supply. The Strategic Sale was conducted in ETH, BTC, and USD, and raised a total of 77.1 ETH, 15.3 BTC, and 2,135,000 USD.

CoinList Auction Sale overview: the CoinList Auction was conducted on March 24th, 2020 for 8,000,000 SOL at a rate of 0.220 USD = 1 SOL, and raised a total of 1.76 MM USD, selling 1.64% of total token supply in a dutch auction via CoinList.

3.4 Token governance and use of funds

As of writing, Solana has used approximately 11.79MM USD (46.12%) of token sale funds, according to the allocations below:

3.00% Partnerships.

3.00% Marketing.

35.00% Team.

35.00% Development.

12.00% Professional Services & Legal.

3.00% Taxes.

6.00% Office Rent.

3.00% Others.

Community tokens are held by the Swiss Foundation, which is run by an independent board. This token pool is used for bounties, incentives programs, marketing, and grants. Tokens held by the Foundation are held in Coinbase Custody, on hardware wallets, and in cold storage. The team stores all of its funds in an USD bank account.

3.5 SOL token release schedule

The Solana team plans to implement token inflation as mainnet goes live. All tokens from inflation will be distributed to token holders in the form of delegation and staking rewards.

The following chart represents the number and breakdown of all SOL tokens that are to be released into circulation on a monthly basis. The token schedule does not include token inflation.

SOL token release schedule

4.1 Original roadmap & achievements

Planned Date Milestone Actual Date Early / Late Commentary 2018 Q1 Release of Whitepaper 2017 Q4 Early Whitepaper 2018 Q1 Release of Single Node Private Testnet 2018 Q1 On Time Github 2018 Q2 Release of Multi Node Private Testnet 2018 Q2 On Time Github 2018 Q3 Release of Payments SDK 2018 Q3 On Time Github 2018 Q3 Release of Smart Contracts SDK 2018 Q3 On Time Github 2019 Q1 Release of On-Chain Programs 2019 Q1 On Time Github 2019 Q2 Implementation of the Move Virtual Machine developed by Libra 2019 Q2 On Time Github 2019 Q2 Release of Multi region, multi cloud testnet 2019 Q2 On Time Github 2019 Q2 Release of Smart Contracts Engine 2019 Q2 On Time Github 2019 Q3 Release of Incentivized Testnet 2019 Q4 Late Github 2020 Q1 Release of Mainnet Beta 2020 Q1 On Time Github 2020 Q3 Mainnet Launch N/A In Progress N/A

Q1 2020

Release of an improved version of JSON RPC API.

Mainnet Beta.

Q2 2020

Release of Smart Contracts features.

Binance public launch.

Activation of token inflation and transaction fees.

4.3 Commercial partnerships and business development progress

Civic: Civic is a decentralized identity ecosystem, enabling identity verification in a safe and cost-effective way. Civic has partnered with Solana to integrate their decentralized identity solution . The solution is targeted at providing low-cost, scalable identity management in emerging economies that lack the infrastructure.

. The solution is targeted at providing low-cost, scalable identity management in emerging economies that lack the infrastructure. Hummingbot: Hummingbot is an open-source crypto trading software client that allows users to trade cryptocurrency with high-frequency trading strategies such as market making and arbitrage. Hummingbot is working together with Solana to integrate their Liquidity Mining solution so that miners/traders can earn fees by providing liquidity to Solana across various exchanges .

so that miners/traders can earn fees by . Chainlink: Chainlink is a decentralized oracle network that enables smart contracts to securely access off-chain data feeds, web APIs, and traditional bank payments. Together with Chainlink, Solana intends to develop a high frequency Oracle that can be used for trading binary options.

that can be used for trading binary options. Akash: Akash is focused on delivering a permissionless, sovereign and open cloud service architecture. Akash is integrating its serverless supercloud infrastructure into Solana to allow users to easily deploy powerful and low cost servers to run nodes or to scale their application.

to allow users to easily deploy powerful and low cost servers to run nodes or to scale their application. LoanSnap: LoanSnap is a mortgage company that offers Smart Loans to homeowners. LoanSnap is integrating its HomeCoin token into Solana to offer users a way to earn rewards for HomeCoin holders in return for providing liquidity for loans .

to offer users a way to . Fortmatic: Fortmatic has developed an SDK that allows users to access decentralized applications with a phone number or email address, all without the need for a browser extension. Fortmatic is integrating its SDK into Solana to provide easy-to-use alternatives to web3 wallets (i.e., MetaMask) for end-users and developers.

(i.e., MetaMask) for end-users and developers. dFuse: dFuse is a blockchain API company that makes it possible to stream real-time state updates, conduct lightning-fast searches and provide irreversible transaction guarantees by simply using a simple API call. dFuse is implementing its API solution into Solana to allow developers to build and maintain performant applications with ease on top of the protocol.

to allow developers with ease on top of the protocol. Pocket Network: Pocket Network was created as an inclusive relay network for API requests to major blockchains, with a crypto-economic model that minimizes costs for developers while passing the value directly on to the full-nodes. The project will be integrating with Solana to help enable primitives for a new, censorship-resistant web3 stack.

5. Project team

Anatoly Yakovenko CEO Former Software Engineer at Dropbox and Mesosphere, Senior Engineer Manager at Qualcomm Boulder, co-founder of Alescere. Greg Fitzgerald CTO Former Senior Software Engineer at Qualcomm Boulder, System Software Engineer at Alescere. Raj Gokal COO Venture investor at General Catalyst, Former Director of Product at Odama Health, Entrepreneur in Residence at Rock Health, CEO and co-founder of Sano. Eric Williams Chief Scientist Former Chief Data Officer and co-founder at Motion, VP of Data Science & analytics at Odama Health, Rearcher at CERN. Michael Vines Engineer Stephen Akridge Engineer Jack May Engineer Carl Lin Engineer Tyera Eulberg Engineer Ryo Onodera Engineer Dan Albert Engineer Justin Starry Engineer Trent Nelson Engineer

6. Solana's activity and community overview

6.1 Development activity

6.1.1 Key public GitHub repositories

6.1.2 Key private GitHub repositories

break Break Solana Game 7 Contributors 244 commits solana-com The Solana Website 4 Contributors 199 commits

6.2 Community data

Solana drives engagement across three core communities: end users, developers, and validators. Solana has a strong focus in core geographies across China, Russia, South Korea, Japan, and the United States. Solana continues to grow its presence in Asia as they rapidly expand their presence across Europe.

Current community strategies

Solana's current global community strategies include:

Rewarding community members with exclusive access, potential funding, free Solana swag via the Solana Collective. As of the time of writing, Solana has 40 active members and has received over 100 applications across 32 different countries since starting the program.

Conducting technology podcasts to educate the public.

Hosting online and local meetups.

Offering grant and mentorship programs to teams which aims to on Solana.

Creating a validator blog series, highlighting validators within the community each week to help them grow their brand.

Conducting incentivized testnet program to both grow the validator ecosystem and on-board new validators into the network.

Conducting bi-Weekly calls with the validator community for general Q&A and project updates.

Solana's current regional community strategies include:

Russia

Having a full-time regional manager to support operations.

Constantly engaging with the community via social channels.

Transating all material in English into Russian.

Conducting interviews and AMAs with the Russian and Ukrainan communities to share the companies goals, technology, and vision.

Hosting local events with validator partners.

China

Having a full-time regional manager to support operations.

Operating a dedicated Solana WeChat discussion channel, including an official WeChat channel to deliver community updates and major announcements.

Transating all material in English into Chinese.

Hosting local events with validator partners.

Dilivering consistent media coverage by with partners including Chainnews and Blockbeats.

South Korea

Constantly engaging with the community via social channels.

Maintaning Naver blog with translated blog posts.

Dilivering consistent coverage in Coin Cat Media, CC TV News, Decenter, and more.

Japan

Constantly engaging with the community via social channels.

Running a Japanese Medium account with translated blog posts.

Dilivering press coverage in popular Japanese media like CoinChoice.

United States

Constantly engaging with the community via social channels.

Hosting live AMAs and interviews across various publications.

Dilivering press coverage on CoinDesk, Fortune, WSJ, Cointelegraph, and more.

Southeast Asia

Building out a dedicated Telegram for the Indonesian and Vietnamese community.

Future community strategies

Solana's future global community strategies include:

Continuing to provide an engaging blockchain-focused podcast with top industry experts and thought leaders.

Providing office space, funding, and mentorship to strong candidates within the Solana ecosystem.

Expanding the reach of the Solana Collective by organizing giveaways and competitions for local blockchain enthusiasts to promote the project.

Solana's future local community strategies include:

Russia

Cotinuing to host live AMAs and podcasts.

Participating in Russian Blockchain conferences and events.

Co-marketing with local projects who have built their own communities.

Hosting local hackathons.

China

Hiring another full-time community manager.

Maintaining a good relationships with Chinese press including BlockBeats and ChainNews.

Having Consistent and timely translation.

Translating and posting updates in Weibo account.

South Korea

Hiring a full-time community manager.

Expanding Kakao groups through grassroots community organizing with local ambassadors.

Growing the Korean-only Telegram through native Korean campaigns organized by members of the Solana Collective.

Having media appearances and interviews with Korean press using prior relationships.

Japan

Growing existing Japanese social media channels.

Hosting local virtual events in Japanese.

Other

Hiring a community manager in Indonesia.

Hiring a community manager in Vietnam.

Growing the Collective Program in Southeast Asia to get members involved in local events.

Blog posts and major announcements translated and distributed across local media publications.

Community and social channels (as of May 23th 2020)

Twitter (English) | 51.1K Followers

Telegram (English) | 44.2K Members

Reddit (English) | 1.9K Members

YouTube (English) | 781 Subscribers



7. Appendix