Solana is a high-performance blockchain designed for speed and very low fees. It can handle a large number of transactions per second, which makes it a popular base layer for decentralized finance, NFTs, and consumer apps. Its native token is called SOL, used to pay fees and to secure the network through staking. Solana was designed by Anatoly Yakovenko, whose background in distributed systems shaped the network’s timing-based approach to ordering transactions, and its mainnet beta launched in 2020.

How solana works

Solana combines proof of stake with a timing method it calls proof of history. Proof of history timestamps transactions before they are added to the chain, so validators spend less effort agreeing on their order, since a verifiable sequence already exists before consensus even begins. Solana also processes non-overlapping transactions in parallel rather than strictly one after another, an approach the network calls Sealevel, which helps it sustain high throughput. The combined result is fast confirmation and fees that are usually a fraction of a cent. For the underlying mechanics of any chain, see our blockchain guide.

Key facts

What makes solana different

Most of solana’s appeal comes from throughput and cost. Where some networks slow down and grow expensive when busy, solana aims to keep fees low even under heavy load. That has made it a home for high-volume trading apps and consumer products that would be impractical on a slower or more expensive chain. The trade-off is that the network has historically been more demanding to run, requiring validators with strong hardware, and it has had outages during periods of extreme demand. Developers have released repeated protocol upgrades aimed at improving resilience under load.

Solana’s token economics

SOL has an inflationary issuance schedule coded into the protocol, meaning new SOL is created over time to reward validators and delegators who stake their tokens, though the rate is designed to decrease gradually over the years rather than stay fixed forever. A portion of every transaction fee is burned, permanently removing it from circulating supply, while the remainder goes to the validator that processed the transaction. This combination of ongoing issuance and fee burning means solana’s net supply growth depends on both network usage and the current stage of its issuance schedule, rather than a single fixed number like bitcoin’s cap.

Solana compared with bitcoin and ethereum

Solana takes a different design path than bitcoin and ethereum. Bitcoin optimizes for simplicity and a long, uninterrupted security record, deliberately avoiding complex features. Ethereum leans on a large developer ecosystem and pushes scaling onto layer-2 networks that settle back to its base chain. Solana instead tries to deliver high throughput and low fees directly at the base layer using a single, tightly coupled network, which can mean fewer steps for users but places more demand on the validators running the core chain. None of these approaches is objectively correct, they represent different bets about how blockchains should scale.

What solana is used for

• Decentralized finance apps such as exchanges and lending markets.
• NFT collections and marketplaces that need low minting costs.
• Payments and consumer apps where speed and cheap fees matter.
• Staking, where holders lock SOL to help secure the network and earn rewards.
• Gaming and social applications that need fast, cheap transactions to feel responsive.

Risks to understand

Solana’s history of network outages during periods of extreme demand is a real operational risk, even as developers have worked to improve stability with successive upgrades. Like any crypto asset, SOL is volatile, and regulatory treatment of tokens like SOL continues to evolve; our crypto regulation overview tracks the current landscape. Running a validator or even a full node requires more powerful hardware than some other networks, which has raised questions about how widely distributed the network’s validator set is compared with older, more established chains.

How to own solana

You can buy SOL on most major exchanges, including those covered in our Binance review, and hold a fraction of a token since SOL divides down to the lamport. Start with our step-by-step how to buy crypto guide, then move your SOL into a wallet you control using our crypto wallets guide. For larger holdings, a hardware wallet such as the ones in our Ledger review keeps your keys offline. If you want to earn yield, read how crypto staking works first.

Frequently asked questions

Is solana a good investment?
SOL is volatile and can fall sharply, so there is no guarantee it will rise. Many treat it as a high-risk, long-term holding. Only invest what you can afford to lose.

Why is solana so fast and cheap?
Proof of history lets the network order transactions efficiently, and parallel transaction processing lets validators handle many transactions at once, which keeps confirmation quick and fees very low compared with older designs.

Has solana ever gone down?
Yes. The network has had outages during periods of very heavy demand. Developers have shipped upgrades aimed at improving stability over time.

Who created solana?
Solana was created by Anatoly Yakovenko, a former engineer with a background in distributed systems, who outlined the proof of history concept before co-founding the project with several others.

Is SOL supply fixed like bitcoin?
No. SOL uses an inflationary issuance schedule that decreases over time, combined with fee burning, rather than bitcoin’s hard cap of 21 million coins.

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