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Solana, a smart contract center, has been the talk of the crypto world for about a month now. Its value increased nearly 7 times between August and September, from merely $30 to over $200. Those excellent moves in the coin and network show that the blockchain is heading to greatness.
Nonetheless, the cryptocurrency has seen its value plummet from the recent ATH to values below $150. Analysts are still discussing whether the crypto’s price action signals a pump and dump scheme. However, they are yet to draw a definite conclusion. Moreover, this blockchain network faced several network issues around the start of September.
One of the reasons driving the growth of this blockchain was the recent introduction of smart contract support. Basically, like Ethereum, Solana can host DApps like NFTs, Defi, and Gamefi. NFTs specifically has been growing at an astonishing rate this year.
Another reason causing the increased interest in Solana is the efficiency of its blockchain. Its TPS has been higher than almost all blockchains. Many of its enthusiasts say it’s the fastest blockchain.
However, recent events in Solana increased doubts on whether the network is decentralized. Read on to discover if the blockchain can achieve complete decentralization!
Events Raising Suspicion on Solana’s Decentralization
Solana’s decentralization has been under severe doubt in the past few days. One of the primary reasons causing doubt is the recent blockchain downtime. This chain faced a very long downtime, which lasted over 17 hours. Basically, in the entire period, it was impossible to use its network.
Early reports indicated that the blockchain’s technical problems arose because of a bug. This network began a fork when the chain’s TPS hit 400 thousand. The platform posted that the forking caused the network nodes to shut down.
However, most network enthusiasts and critiques did not buy the idea that nodes automatically shut down. Twitter and Reddit users complained that the system’s governance just shut the network down.
One of the posts talking about the shutdown got over 14k upvotes on Reddit. Another post said that the blockchain is basically like a bank operating on SQL servers. The comments criticized the blockchain’s centralization.
Denying users’ access is a centralization issue. Often, systems with highly centralized features show them in the course of network problems. Thus, the problems Solana faced brought clarity on the centralized nature of the chain. However, what qualities make Solana centralized? Keep reading for more.
Why is Solana Centralized?
The Presence of Solana Foundation
One of the main things showing that Solana is not at all decentralized is its Solana foundation. Solana foundation is a body created to control the current activities of the Solana network. This foundation maintains the network’s upgrades.
Other chains like Ethereum and Cardano also have almost similar bodies and even CEOs. However, the role of the Solana body goes to a deeper extent. Some note that, in this blockchain, all upgrades and downgrades are implemented by one body.
The same Solana foundation body has the task of creating and improving the code. Thus, many say that the Solana foundation shut down the system immediately when they noticed a bug. One Redditor noted that Ethereum has multiple sources running and implementing the code. Hence, if one fails, others will still be working. Solana’s dependence on one body is a sign of deep centralization.
However, the Solana network said that the Shut down was autonomous by the node validators. Other Solana enthusiasts noted that the critics are just competitors tarnishing Solana’s name. But, the fact still stands that having a foundation makes Solana a centralized chain.
The Number of Validators
The Solana network, although one of the largest cryptos, has very few validators. The most recent report on the number of Validators in Solana shows that the network has just 608 validators. So, how much should such a network have?
Compare Solana to Bitcoin. Bitcoin is the largest blockchain network. Bitcoin has at least 1 million miners. Now, 1 million people participating in mining shows that the network has a massive distribution. Thus, when compared to every other chain in the crypto world, Bitcoin is the most decentralized.
The 608 in the blockchain, one of the most significant assets by far, means that very few validators control the release of new coins. 608 is an insufficient number for a $50 billion network. Thus, decentralization is currently lacking in the Solana network.
However, others say that since Solana is still in the early stages, it will get more validators with time. Thus, in the long term, Solana will become more decentralized.
Why Decentralization Matters
There is no harm in blockchain centralization. Others like XRP have in the past faced similar problems.
However, some say that being dishonest about the nature of the chain is the problem. Generally, if a centralized blockchain claims to be the opposite, it loses users’ confidence and trust. Investors may stop investing their monies in crypto networks due to lacking faith.
There is no point in time where a blockchain will be fully decentralized. However, Chains can do more by the day to distribute more of their governance.
After looking into the Solana world, it’s pretty clear that the network is not entirely decentralized. The events which propelled doubts are one of the significant proofs of blockchain’s centralized nature. However, the presence of its foundation and only a tiny group of validators show the level of its centralization.
The blockchain faced many criticisms. Yet, others note that since the chain is still growing, it will decentralize activities. For instance, as the number of node validators grows, so will the decentralization. Being a very reliable smart chain, Solana must take decentralization more seriously.