Solana stock (BTC-SOL) has certain distinguishing features that make it a potential threat in the payments business.
The cryptocurrency market, like the stock market, has taken a hit in 2022, with its value falling by approximately two-thirds in the first nine months of the year. Global central banks are primarily to blame, having tightened monetary policy and driven investors to avoid the riskiest and most speculative financial assets.
Market Analysis of Solana Stock
Solana stock (BTC-SOL), the ninth-most valuable cryptocurrency with a market capitalization of $11.6 billion (as of this writing), is down more than 80% in 2022. Is it time for investors to acquire this outstanding digital asset cheaply?
Solana Has Distinct Traits.
Solana’s blockchain, like Ethereum’s, enables the creation of smart contracts. These self-executing computer programs execute when two unconnected persons meet specific criteria. Smart contracts, which do not need any middlemen, may significantly expand the usefulness of a blockchain.
Furthermore, even before Ethereum’s The Merge, Solana (BTC-SOL) operated a proof-of-stake (PoS) consensus process. PoS, which aims to be scalable and environmentally benign, allows token owners to lock up their holdings to help verify new transactions and earn additional tokens.
Solana (BTC-SOL) also has proof-of-history, which removes the need to add timestamps to blocks, decreasing data load and allowing for quicker throughput. It’s a significant advancement, and it’s the reason Solana can potentially handle 50,000 transactions per second (TPS). In comparison, Ethereum presently manages less than 15 TPS.
However, while having some amazing qualities, Solana (BTC-SOL) has experienced some troubles in the past. In August, wallets containing SOL were hacked, and consumer funds were taken. Previously, Solana’s network went down in June, forcing decentralized apps to fall offline. These happenings should come as no surprise in the chaotic world of cryptocurrency.
Nonetheless, Solana’s fantastic speed, combined with minimal transaction costs that are fractions of a cent, positions it as a potential challenge to the payments industry. Solana Labs established a new service called Solana Pay in February.
Solana Pay establishes a direct link between a client and a merchant, with payment performed through a QR code and the SOL token. The advantage is that processing costs are almost non-existent. This configuration enables the merchant to create a stronger relationship with the user, opening the door for more complex loyalty programs and potentially introducing non-fungible tokens.
Among the largest payment companies, Visa, Mastercard, PayPal, and Block have a combined market valuation of about $800 billion. Even if Solana Pay just captures a little portion of this large pie, the network’s worth might skyrocket over the next decade.
Solana Stock: What Can Investors Do?
I believe Solana stock (BTC-SOL) has enormous promise since it has already shown its capacity to develop a specific, real-world use case that may be tremendously profitable in the long run. This cannot be true of many other cryptocurrencies now, which only make outstanding claims of increasing usefulness in the future. Solana stock is already providing value.
Buying the dip now might prove to be a wise financial option.
Featured Image- Unsplash @ amjiths