Solana

Solana is a proof-of-stake layer 1 blockchain designed for high throughput and low fees, with smart contracts (called programs) that can run in parallel. It was conceived in 2017 by Anatoly Yakovenko, whose design used a technique he called Proof of History to order transactions before validators vote on them. Its main network launched as a "mainnet beta" in March 2020. Its native token, SOL, pays transaction fees and is staked to validators.¹²

HistoryReport an error

Origins

Yakovenko moved from Ukraine to the United States as a child and worked at Qualcomm for nearly 13 years, including on distributed systems, leaving in 2016. According to Fortune, the idea for Proof of History came to him in 2017 while he and a friend were mining cryptocurrency to offset the cost of hardware they were building for deep learning: he realised that the passage of time could itself serve as a data structure for ordering events. The project was first named Loom and was renamed after a similarly named Ethereum project appeared. Raj Gokal joined as a co-founder at the end of 2017; Greg Fitzgerald and Stephen Akridge, also former Qualcomm engineers, were early co-founders.³

Yakovenko set out the design in the whitepaper Solana: A new architecture for a high performance blockchain. It proposed Proof of History as "a proof for verifying order and passage of time between events", to be used alongside a proof-of-stake consensus algorithm to reduce messaging between nodes, and estimated that up to 710,000 transactions per second were possible on a 1 Gbps network.² According to the US Securities and Exchange Commission (SEC), Solana Labs, Inc. was founded in 2018 by Yakovenko and Gokal and is headquartered in San Francisco.⁴

Funding and token sales

The SEC stated that between May 2018 and early March 2020 Solana Labs sold about 177 million SOL through Simple Agreements for Future Tokens, raising over US$23 million in offerings Solana Labs said were exempt from registration. In March 2020 it sold about 8 million SOL in a Dutch auction on CoinList at US$0.22 each, raising about US$1.76 million.⁴⁵ In July 2019 Solana announced a US$20 million round led by Multicoin Capital,⁶ and on 9 June 2021 Solana Labs announced a US$314,159,265 private token sale led by Andreessen Horowitz and Polychain Capital, open only to offshore investors. Alameda Research and Jump Trading were among the participants.⁷

SOL had a genesis supply of 500 million tokens. Fidelity Digital Assets, citing Crypto.com data, gives the initial allocation as:¹

The SEC complaint instead cites Solana Labs as having stated that 12.5% of the initial supply went to its founders and 12.5% to the Solana Foundation.⁴

Foundation and mainnet beta

The Solana Foundation, a Swiss non-profit, was created in June 2019 to oversee governance and coordination of the protocol.⁶ On 8 April 2020 Solana Labs transferred 167 million SOL to it.⁴ Mainnet beta launched on 16 March 2020.⁸

Weeks later, users found an account holding more than 13 million SOL. The foundation said on 27 April 2020 that it had lent 11,365,067 SOL to a market maker without disclosing the loan during the CoinList auction and Binance listing, and apologised.⁹ On 22 May 2020 it removed that amount from the token supply, and the tokens were burned on 25 May 2020.¹⁰ Inflationary staking rewards were activated on 10 February 2021.⁸

FTX and Alameda

FTX and Alameda Research were closely tied to the early Solana ecosystem. In July 2020 they created the Serum Foundation and launched Serum, an order-book exchange on Solana.¹¹ The Solana Foundation sold Alameda and FTX more than 50 million SOL between August 2020 and January 2021, most of it locked and unlocking monthly until 2027 or 2028, and Solana Labs sold Alameda a further 7.5 million SOL in February 2021.¹²

When FTX and Alameda filed for bankruptcy in November 2022 (see FTX), SOL fell sharply, and Fortune reported an analyst's view that its close association with Sam Bankman-Fried was weighing on it. Yakovenko said Solana Labs held no assets on FTX.¹³ The Solana Foundation disclosed about US$1 million in cash on FTX, together with FTX shares and FTT and SRM tokens held there. It also said that wrapped assets issued through Sollet, a custodial bridge, worth about US$40 million had an unknown backing.¹²

Solana Labs, Anza and client diversity

The validator client was originally developed by Solana Labs. On 2 March 2024 Anza, a firm of former Solana Labs executives and engineers, forked that client into a new repository and named it Agave.¹⁴ Jump Crypto has been building Firedancer, an independent client written in C, since 2022; a first version went live on testnet in October 2023.¹⁵¹⁶¹ A hybrid version, Frankendancer, reached mainnet in September 2024,¹⁷ and the Solana Foundation announced that Firedancer was live on mainnet in December 2025.¹⁸ The Jito Foundation maintains Jito-Solana, a fork of the validator that it describes as an MEV client, and Jito offers transaction bundles used by traders seeking maximal extractable value (MEV).¹⁹²⁰

Saga and consumer products

In June 2022 Solana Mobile, a subsidiary of Solana Labs, announced Saga, an Android phone built by OSOM with a secure element for storing keys, priced at US$1,000.²¹ It went on general sale on 8 May 2023.²²

Memecoins and pump.fun

Pump.fun, launched in January 2024, lets anyone create a Solana token in a few clicks.²³ It paused its livestreaming feature on 25 November 2024, citing moderation problems, amid criticism of stunts and threats made on streams.²⁴ In July 2025 it raised US$600 million in 12 minutes in a public sale of its token, plus about US$720 million privately.²⁵ In January 2025 the launch of a memecoin by Donald Trump drove a surge in Solana activity; Coinbase users saw delayed Solana withdrawals, which Coinbase attributed to its own systems.²⁶

Exchange-traded products

On 28 October 2025 Bitwise began trading BSOL on the NYSE, which it described as the first US spot Solana exchange-traded product; it intended to stake all of the fund's SOL.²⁷ Grayscale launched a Solana fund around the same time, followed in November 2025 by VanEck, Canary Capital and Fidelity.²⁸

Regulation

In June 2023 the SEC alleged in its complaint against Coinbase that SOL was offered and sold as a security.⁴ The SEC dismissed that case in February 2025, saying the dismissal was not a judgement on the merits.²⁹ On 17 March 2026 the SEC issued an interpretation, with guidance from the Commodity Futures Trading Commission, that listed SOL among its examples of digital commodities, which it does not treat as securities.³⁰

2026 upgrades

In 2026 several protocol changes reached mainnet. The block limit rose from 60 million to 100 million compute units on 29 July 2026.³¹ Slot times were cut from 400 to 200 milliseconds in four steps, the last on 9 October 2026.³² Alpenglow replaced Tower BFT on 21 October 2026 (see Consensus). A proposal to double the rate at which inflation declines, SIMD-0550, was merged into the improvement document repository on 23 July 2026 and went to a stake-weighted vote in August 2026.³³³⁴

TechnologyReport an error

Accounts and execution

Solana separates programs from the accounts that hold data and balances. Each transaction lists every account it will read or write. Sealevel, the runtime, uses these lists to run transactions that do not touch the same accounts in parallel.³⁵

Leaders, Gulf Stream and Turbine

Validators take turns as leader according to a schedule known in advance. Gulf Stream uses this to forward transactions straight to upcoming leaders instead of keeping a shared mempool, and transactions reference a recent block hash so that they expire if not included.³⁶ Turbine spreads a block across the network by splitting it into small pieces called shreds, adding erasure-coded redundancy, and relaying them through a stake-weighted tree of validators.³⁷³⁸

Consensus

Under the original design, the leader ran a sequential hash chain, Proof of History, recording transactions into it to prove their order and the time elapsed.² Tower BFT, a variant of practical Byzantine fault tolerance, used that chain as a clock: each vote locked a validator out of voting for conflicting forks for a period that doubled with each later vote.³⁹ Votes were sent as on-chain transactions, and finality took about 12.8 seconds.⁴⁰

Alpenglow, specified in SIMD-0326 by Quentin Kniep, Kobi Sliwinski and Roger Wattenhofer, replaces this layer. It finalises a block in one round of voting if 80% of stake votes for it, or in two rounds with 60%. It is designed to tolerate 20% adversarial stake plus a further 20% offline, whereas Tower BFT needed a supermajority of more than two-thirds of stake to confirm a block.⁴¹⁴⁰ Validators approved it in a stake-weighted vote whose result CoinDesk reported on 2 September 2025, with 98.27% of the stake that voted in favour and 52% of stake taking part.⁴² Its first phase, Votor, activated at epoch 1064 on 21 October 2026, targeting finality of about 150 milliseconds. Validators now exchange votes directly and aggregate them into certificates, vote transactions no longer appear in blocks, and Proof of History no longer paces block production. Each voting validator pays a flat fee of 0.8 SOL per epoch, which is burned. The second phase, Rotor, will replace Turbine and was not scheduled as of October 2026. Firedancer was not supported for the switchover, and validators had to run an Agave-based client: Agave, Jito-Solana or Harmonic Salsa.⁴⁰

Token and feesReport an error

Every transaction pays a base fee of 5,000 lamports per signature, of which half is burned and half goes to the block-producing validator. Users can add a priority fee, priced per compute unit, to be scheduled sooner.⁴³ Priority fees were originally also half burned. Under SIMD-0096, approved by validators in 2024 with 77.7% of votes, they go entirely to the validator; critics noted that validators voted on a change that benefited them.¹⁴³ Fidelity Digital Assets noted that this reduced the amount of SOL burned to near zero.¹

New SOL is issued as staking rewards. The schedule began at 8% a year and falls by 15% each year until it reaches a long-term rate of 1.5%.⁸⁴⁴ SIMD-0550 proposes raising the rate of decline to 30% a year, which its authors estimate would reach 1.5% in about 2.8 years instead of 5.7.³⁴

GovernanceReport an error

Protocol changes are proposed as Solana Improvement Documents (SIMDs), discussed off-chain, and implemented by the client teams. Changes with economic effects, such as SIMD-0096 and Alpenglow, have been put to stake-weighted votes.¹⁴² Fidelity Digital Assets described the system as one in which validators cast the votes, and noted the criticism that SOL holders who do not stake are not represented.¹ By August 2026 holders who stake directly could override their validator's vote on a proposal.³⁴

Incidents and controversiesReport an error

• Outages. On 14 September 2021 the network was offline for about 17 hours after bots flooded it with transactions during a token offering.⁴⁵ On 30 April 2022 consensus stalled for about seven hours after bots sent millions of transactions per second to mint NFTs.⁴⁶ On 1 June 2022 a bug in durable nonce transactions halted block production for four and a half hours.⁴⁷ On 30 September 2022 a misconfigured validator producing duplicate blocks triggered a consensus bug, and production stopped for about eight hours.⁴⁸⁴⁹ In each case validators coordinated a restart of the network.⁴⁵⁴⁷
• Degradation in February 2023. On 25 February 2023 block-forwarding services repeatedly re-sent an unusually large block, overwhelming Turbine; validators restarted the cluster with downgraded software.⁵⁰
• Outage in February 2024. On 6 February 2024 a bug in the program cache halted finalisation for about five hours.⁵¹
• Wormhole bridge (February 2022). An attacker exploited a signature-verification flaw in the Solana side of the Wormhole bridge to mint about 120,000 wrapped ETH without backing, worth about US$326 million.⁵²⁵³ Jump Crypto replaced the 120,000 ETH the next day.⁵³
• Slope wallet (August 2022). On 2 August 2022 attackers drained 9,231 wallets of about US$4.1 million in assets. The Solana Foundation said the affected keys had been created or imported in Slope's mobile wallet, which had sent private key material to an application monitoring service, and that the Solana protocol was not involved.⁵⁴
• Securities status. The SEC alleged in 2023 that SOL was a security, dropped the case in 2025, and listed SOL as a digital commodity in 2026.⁴²⁹³⁰

TimelineReport an error

See alsoReport an error

• Ethereum
• FTX, an early backer whose collapse affected Solana
• USDC and Tether, both issued natively on Solana
• Hyperliquid

ReferencesReport an error