Thor Hartvigsen, DeFi researcher and business development professional at Redacted Cartel, shared a detailed analysis about Solana’s potential to achieve mass adoption today. Hartvigsen’s analysis focuses on technical aspects and key developments (aside from price speculation) within the SOL ecosystem that could pave the way for its widespread acceptance.
Parallel execution, Solang, Eclipse and Neon
An important feature of Solana is its ability to process multiple transactions simultaneously using “parallel execution.” This method contrasts with the sequential processing found in many other blockchains such as ethereum.
Hartvigsen notes: “This parallelism in processing ensures that activities like large nft coins, which could increase transaction fees, do not negatively impact the cost of transactions for DeFi users, as they are handled in separate threads.” .
Solang, a Solana compiler, is another crucial element in achieving mass adoption. It allows developers to create decentralized applications (dApps) using Solidity, which is commonly used for ethereum virtual machines (EVMs). This support potentially makes it easier for EVM developers to transition to Solana Virtual Machine (SVM).
Eclipse, a Layer 2 rollup scheduled to launch on ethereum later this year, is also poised to become a major driver of mass adoption. It aims to bring the high performance of Solana to the ethereum ecosystem by leveraging SVM for execution.
Hartvigsen explains: “Eclipse integrates the ethereum mainnet for settlement, Celestia for data availability, and Risc Zero for validity proofing, creating a robust cross-chain solution.”
NeonVM, a native Solana virtual machine, integrates EVM with the SOL framework and could be a major weapon in its competition with ethereum. This integration allows developers to deploy ethereum dApps on Solana, benefiting from lower gas fees and faster transaction processing.
The Solana DeFi Ecosystem
The Solana DeFi ecosystem has shown notable growth in recent months, particularly in areas such as lending, DEX volumes, and liquid staking. As ethereum‘s growth story has shown, DeFi could become an important pillar for SOL adoption.
Hartvigsen highlights several key protocols. Among them is Jito, Solana’s largest liquid staking derivatives (LSD) protocol. It offers a stable yield (~6.88%) on SOL tokens, derived from staking rewards and maximum extractable value (MEV). According to the researcher, the recent announcement regarding the launch of its JTO governance token is a significant development.
Additionally, Hartvigsen mentions Jupiter, a DEX aggregator that handles the majority of swap volume on Solana ($3.9 billion in the last 30 days). They also launched a beta version of their perpetual futures product, which offers up to 100x leverage on cryptocurrencies such as btc, eth, and SOL.
Finally, the researcher highlights Marginfi, known as the largest loan market. Marginfi was one of the first to implement a “point system”. This system allows liquidity providers to earn points, which are then translated into a token airdrop. The total value locked (TVL) at marginfi tripled in the last month, reaching $150 million.
While Hartvigsen himself does not come to a conclusion, his analysis shows that the Solana ecosystem is very well positioned to continue growing and compete with ethereum.
At press time, SOL was trading at $60.81. In recent weeks, SOL price found support at the 100-week EMA and is aiming for a weekly close above the 0.236 Fib retracement level at $60.00.
Featured image from Shutterstock, chart from TradingView.com
