Solana
Solana Returns vs S&P
356.50%
Versus S&P
•
16 minutes ago
356.50%
Versus S&P
•
16 minutes ago
6m High
6m Low
Solana
$202.87
$31.65
S&P 500
5,254.35
4,117.37
Solana
S&P 500
Does not follow the stock market
Sources: SOL, SPX
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In the Market
Highlights
Good For
DeFi value investing
Time Horizon
Medium term
Diversification
Environmentally Friendly
Solana is a blockchain designed by the computer programmer Anatoly Yakovenko and his team. It was invented to solve major traffic and service fee problems on the crowded Bitcoin and Ethereum networks, and some major financial players, including Bank of America, speculate that the Solana could take over the lion’s share of the market. The most distinguishing feature of Solana is its hybrid consensus mechanism technology dubbed “Proof-of-History.” With Solana’s tech upgrades, blockchain transactions can happen in as little as 400 milliseconds, compared to Ethereum’s 10 to 15-second processing speeds.
Did you Know
Melania Trump is a Solana fan and minted her first NFT collection on the platform. The Solana team, however, was reportedly a little “meh” about the whole thing.
Solana launched its own version of Apple Pay, Solana Pay, in early February 2022.
If you had bought $1,000 of SOL on May 11, 2020, it would have been worth $357,040 on January 1, 2022.
Considerations
Powerful backers like the VC firm Andreeson Horowitz
Market cap between $35 billion and $57 billion
Innovative tech appeals to small-time traders and institutional investors alike
Strong adoption since launching in 2020 and has processed over 50 billion blockchain transactions
Reasons to Invest
Major potential, but only time will tell if Solana’s technology proves scalable
Solana’s mainstream appeal is a turnoff to some decentralized die-hards
Recent Wormhole hack led to a multi-million crypto heist—the money was recovered, but Solana’s price dove 10%
Drawbacks
How You’re Taxed
Capital Gains
Until the Securities and Exchange Commission (SEC) rules that utility tokens like SOL are securities, you should at least consider all crypto an asset. Capital gains rules therefore apply when trading crypto for profit and/or loss. Most tax payers will owe 15% or 20% (based on your income) in capital gains tax after holding assets for at least one year then selling. You’ll get taxed at your regular income tax rate on any crypto profits you make from assets you held under one year. Fortunately, buying small amounts of crypto on centralized exchanges like Gemini doesn't usually count towards capital gains—you have to sell it or exchange it for another crypto or fiat currency.