Solana is a public base layer blockchain protocol built to facilitate decentralized app (DApp) creation with scalability.
Among Solana’s distinct features is a timestamp system called Proof-of-History (PoH) which is responsible for the bulk of transaction processing. It records successful operations and the time that has passed between them. The proof-of-stake (PoS) consensus is used as a monitoring tool for the PoH processes, and validates each sequence of blocks produced by it to increase the network’s security.
In 2017, Anatoly Yakovenko released a preliminary whitepaper outlining a new timekeeping technique for distributed systems (PoH). For Bitcoin and Ethereum blockchains, the timeframes required to finalize transaction orders act as a limit to scalability. Yakovenko proposed that his new method could streamline the process of ordering transactions and increase crypto network scalability.
Yakovenko later teamed up with former colleague Greg Fitzgerald and introduced the project’s first internal testnet and the official whitepaper in February 2018. The same year the first prototype was released, Yakovenko assembled a team that included Fitzgerald and others. They established the company Loom which would later rebrand as Solana.
From April 2018 to July 2018, Solana raised $20 million in private token sales and in March 2020, the protocol launched on Mainnet Beta.
How does it work?
Unlike traditional blockchains that use mechanisms like Proof of Work (PoW) or Proof of Stake (PoS) alone, Solana introduces a novel timestamp system called Proof of History. This system allows for greater efficiency and speed as it creates a historical record of all transactions, allowing the system to trust the timing and ordering of events without additional verification.
The SOL token pays for transaction fees incurred when using the network or smart contracts is also used for staking as part of the PoS consensus mechanism.
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