Only Possible on Solana: A Unique Tech Stack for Unique Use Cases

10 min readJan 7, 2024

The blockchain trilemma is deeply rooted in the industry: It’s widely believed that blockchains are built in such a way that forces developers to sacrifice scalability, security, or decentralization in favor of the other two.

Solana was designed to surpass this perceived limitation and provide developers and users with a scalable, secure, and decentralized network that can process transactions at the speed of light for minimal costs, all in a user-friendly environment. Let’s look into the basics of Solana and what sets it apart from other blockchains.

What Is Solana?

Solana is an open-source, high-performance blockchain built for mass adoption. It was founded in 2017 by Anatoly Yakovenko, a former Qualcomm executive, with the goal of solving the blockchain trilemma, that is, satisfying all three desirable properties of a proper blockchain: scalability, security, and decentralization.

Like many other blockchains in the market, Solana’s architecture was designed to simplify the development of smart contracts and decentralized applications (dApps) while supporting a wide range of use cases, including finance, NFTs, payments, and gaming. However, what makes Solana unique is that its ultimate goal is to surpass the performance of popular blockchains like Ethereum while ensuring security and decentralization and keeping costs to a minimum.

What Makes Solana Unique?

More and more blockchain projects are entering the market each day, and they all boast about unprecedented scalability, unbelievable speed, and unwavering decentralization. But most don’t really live up to the expectations.

Solana seems to be the only one that comes close to fulfilling the promise of a high-performance, scalable, decentralized blockchain. Here’s why:

1) Highly scalable. The issue of scalability — that is, a protocol’s ability to increase its TPS (transactions per second) rate — has been hard to tackle, even for big blockchains. Ethereum, for instance, implemented an approach of scaling through multiple layers. The blockchain essentially expanded through a separate blockchain that maintains Ethereum’s security guarantees.

However, this approach comes with certain drawbacks, like interoperability issues, security concerns, the need for standardized protocols, and so on. Instead of mimicking Ethereum’s solution, Solana delivers a scalable blockchain using one single layer and a series of robust, high-speed computers maintaining the network. This approach makes Solana capable of increasing its TPS if demand goes up.

2) Ultra-fast. As of today, despite many attempts to improve transaction throughput, Ethereum can only process 12 to 15 transactions per second, while Bitcoin can process only around between 3 and 7. This means that at peak demand times, these protocols struggle to handle all transactions, and the network’s operation slows down.

Solana has completely disrupted the industry standard through a hybrid model that enables the network to theoretically process over 710,000 transactions per second (TPS) without relying on additional scaling solutions, like Ethereum’s layer 2.

3) Decentralized. Like most blockchains, Solana is designed to be decentralized, meaning that it’s not controlled by any single entity or authority. Alongside other features, the Solana blockchain uses a Proof-of-Stake (PoS) consensus mechanism, which allows validators (those who validate transactions to be recorded on the blockchain) to earn rewards by staking (blocking) SOL tokens.

Solana’s Proof-of-Stake consensus mechanism means that transactions aren’t validated by a single entity but rather by several distributed validators that have a stake (their blocked SOL) in the blockchain and its proper operation.

4) Secure. The key to Solana’s secure network is its hybrid model. On the one hand, it uses the Proof-of-History mechanism to establish a digital ledger of events happening on the network at any specific moment. Think of it as a cryptographic clock that assigns timestamps to every transaction within the network, ensuring the efficient tracking of events.

On the other hand, Solana relies on the Proof-of-Stake mechanism to achieve consensus, ensuring the network’s security, functionality, and the validation of transactions. The blockchain is validated by thousands of nodes that operate independently of each other and have a stake in the proper operation of the network, which ensures data remains secure and decentralized.

5) Reduced costs. Poor scalability and low TPS make transaction fees spike. If a blockchain can only process a couple of transactions per second, as is the case with Ethereum and Bitcoin, then any surge in demand in the network will cause validators to handle transactions for much higher fees than usual.

Solana’s optimization in terms of transaction throughput results in lower fees, which benefits both developers and users. Since Solana can process more transactions in a shorter span of time than most blockchains, its transaction fees are around $0.00025 per transaction.

6) Energy-efficient. Solana claims to be a carbon-neutral blockchain. Its Proof-of-Stake consensus mechanism and other innovations minimize its impact on the environment. In fact, it consumes as much energy as a couple of Google searches.

The Solana Foundation thoroughly studies the impact of the Solana blockchain, sharing the data transparently and taking steps to tackle the chain’s footprint. On top of that, the blockchain has partnered with eco-friendly projects that strive to solve climate-related problems.

Only Possible on Solana

With this outstanding set of features, Solana has positioned itself as the best choice for several use cases ranging from DeFi and gaming to NFTs and payment processing. Let’s explore some of the most prominent use cases for Solana and why they are only possible on this given blockchain.

Global payments: Quick, decentralized, and at scale

Solana’s ability to process a large number of transactions quickly and at a low cost enables the seamless support of decentralized payments at a massive scale. Through Solana Pay, developers can access a toolkit that empowers them to incorporate high-speed payment capabilities similar to those on Wall Street into their applications, ensuring auditability and confidentiality as needed.

Solana’s payment tools allow Web3 and crypto projects or businesses to leverage the blockchain’s power at a pace comparable to traditional payment networks, all without the involvement of third parties and ensuring decentralization. Its cost-effectiveness and immediate settlement for transactions unveil a wide range of possibilities, from on-chain rewards to loyalty programs.

For example, ASICS, a well-known Japanese athletic shoe brand, launched a pioneering brand loyalty program on Solana in November 2022. It leveraged the blockchain’s scalability and utility for creating loyalty programs, as well as its practicality and potential to innovate on its core business goals.

The collaboration with Solana allowed ASICS to pair physical running shoes with an NFT loyalty badge. The loyalty badge, owned by the customers, offered a unique value proposition, and it could be sold, traded, or collected. ASICS also leveraged Solana’s open-source platform and low environmental impact, which enabled the team to efficiently implement its loyalty program without extensive development efforts or a harmful impact on the environment.

State compression: NFT drops for the masses

On top of its unparalleled speed, low environmental impact, and low fees, Solana has introduced state compression, a new way to store data directly on-chain that significantly cuts down on cost. Solana’s state compression is a cost-effective approach that opens up exciting possibilities across various domains, such as event ticketing, collectibles, social media stickers, and beyond.

While Solana boasts low transaction fees, massively minting (creating) NFTs remains cost-prohibitive for most companies. Compressed NFTs, a new category of non-fungible tokens on Solana, use state compression to significantly reduce data storage requirements. The cost of minting Solana NFTs dropped dramatically to approximately $0.000005, making large-scale use cases economically viable for the first time.

For instance, Crossmint, an NFT tooling and API company, partnered with Solana to mint around 300,000 NFTs for Crossmint wallet holders, showing the efficiency of state compression. The cost breakdown comparison for a standard NFT mint on Solana versus using state compression highlights the considerable cost savings, with state compression reducing the expense of delivering NFTs to 300,000 users from over $74,000 to less than $200.

Other potential applications include NFT receipts for e-commerce purchases, social media incentivization, gaming assets, metaverse experiences, ticketing, and on-chain verified credentials for completing digital courses. Compressed NFTs offer a cost-effective and scalable solution for businesses to build engaging relationships with customers across various industries, and they are only available on the Solana blockchain.

A highly scalable tech stack

Solana’s inherent scalability eliminates the need to compromise between decentralization and performance. Whether it comes to creating a groundbreaking video game or delving into new frontiers like AI or decentralized physical infrastructures, Solana empowers developers to unleash their creativity and develop applications that were previously unattainable.

Solana not only facilitates the development of unique projects but also provides seamless integration in areas such as AI. Builders on Solana can readily access the latest innovations, propelling their most ambitious projects to new heights.

Pioneering projects like Helium and Hivemapper are major examples of the exclusive possibilities that Solana has to offer.

Helium is a decentralized network that powers individual hotspots in more than 170 countries and offers 5G services to certain American cities. Initially, Helium used its own blockchain, but in April 2023, prompted by the need for scalability, Helium underwent a significant migration to the Solana blockchain — one of the most substantial layer 1 blockchain migrations.

Launched in November 2022, Hivemapper Network is a global mapping network built on Solana that seeks to create a community-driven, incentive-based online map. Users equipped with dash cams capture street-level images, earning HONEY tokens for data collection, and Hivemapper turns this data into a continually expanding world map. Solana’s state compression technology and its unparalleled scalability are crucial for managing users at scale, reducing fees significantly, and maintaining the rewards cycle.

Climate-conscious blockchain technology

The environmental impact of blockchain technology has been a huge concern, especially in relation to cryptocurrency. The carbon footprint of blockchain technology is substantial, primarily stemming from the energy-intensive processes involved in verifying transactions and generating new blocks on-chain. This leads to considerable greenhouse gas emissions and a significant impact on climate change.

This is yet another reason why Solana stands out in the blockchain industry. Its transactions consume energy equivalent to just a few online searches. The platform prioritizes energy efficiency, and its embedded emissions tracker software on Solana nodes offers real-time and comprehensive measurements. This dynamic and transparent dataset allows stakeholders on Solana to assess their impact and explore strategies for mitigation.

So, companies looking to innovate while protecting the environment and minimizing their footprint are turning to Solana as the best choice for climate-conscious blockchain operations. GainForest, a Regenerative Finance (ReFi) project, is a great example. It leverages the transparent nature of Solana’s blockchain to facilitate verifiable and traceable donations for forest conservation projects. By using on-chain metadata, donors can monitor the health of the supported areas through real-time updating “NFTrees.”

Permissioned Environments: Solana, but customized

Since Solana is an open-source blockchain, anyone could just assume that it isn’t necessarily fit to serve the specific purposes or needs a given company or project may have. However, the Solana Foundation has recently introduced Solana Permissioned Environments (SPEs) to cater to businesses with specific requirements.

SPEs involve deploying a private Solana Virtual Machine tailored to the unique needs of enterprises, ensuring a dedicated environment using Solana protocol’s advanced technology while maintaining its security, scalability, and decentralization features. Businesses can customize their Solana environment, incorporating features such as geofencing nodes, maintaining network authority, or ensuring security and compliance.

The Pyth Network stands as the pioneer SPE in Solana’s framework, meticulously designed for oracle services. Leveraging the Solana Virtual Machine to connect with external data sources, Pyth serves as a vital aggregator, facilitating real-world smart contract execution.

Solana’s high-throughput infrastructure seamlessly aligns with Pyth’s demands for swift data processing and minimal latency, meeting crucial requirements. The robust security model inherent in Solana, combined with Pyth’s dedicated oracle services, ensures the delivery of reliable and secure data for the execution of smart contracts.

Solana makes the impossible possible

Solana stands out as perhaps the only blockchain to successfully combine decentralization, security, and scalability. Solana’s commitment to a decentralized and open ecosystem, coupled with its robust security measures, positions it as a frontrunner in the ever-evolving landscape of blockchain technology.

As the demand for decentralized solutions continues to grow, Solana’s unique approach sets a high standard, proving that it’s more than just a blockchain — it’s a transformative force driving the future of decentralized applications.

How Ubik Capital Facilitates Staking and Delegation

Ubik Capital is a PoS validator across several networks, including Solana, Cosmos Network, Polkadot, Oasis Protocol, Crypto.com, Band Protocol, Aleph Zero, ICON Network, xx Network, Coreum to mention a few.

Ubik Capital makes it easy for users to stake and delegate their coins by providing them with a simple interface and 24/7 support. Furthermore, with 100% uptime across all networks, users can be assured that their coins are always being staked and earning rewards.

If you’re interested in staking your coins with Ubik Capital, you can check out some of their top guides on how to do so:

Proof of Stake is an increasingly popular consensus algorithm, especially with Ethereum’s transition into PoS. There are many variations of a PoS consensus algorithm; however, with this guide, you should understand how it generally works.

Ubik Capital is an excellent option if you’re interested in earning rewards by staking your coins.

About Ubik Capital

Capital is a Proof-of-Stake service provider, validator, and investor. Ubik Capital provides staking-as-a-service as well as investments to various blockchain projects. Ubik Capital secures major networks and is a trusted staking provider with years of industry experience.

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Disclaimer: Not financial advice. Cryptocurrency and blockchain investments are high risk, can incur substantial losses, and are not suitable for everyone. Please consult a professional before considering investment in any cryptocurrency. This article does not encourage or support any specific investments, use of applications or technology, or financial direction. This article is for informational purposes only and should be verified and validated externally for 100% accuracy.