Block production halted

Declining prices isn't the only thing worrying crypto investors this week.

June 03, 2022

Solana halted for over 4 hours

On June 1st the 9th largest blockchain, Solana, was stopped in its tracks and halted for over 4 hours. Around 1:00 PM est Wednesday validators on the blockchain failed to reach consensus due to a bug. This prompted the development team to announce a reset for the network. Luckily, all users funds and the state of the blockchain remained secured and several hours later block production resumed.

For a more technical breakdown of the bug check out CoinDesk for more in-depth analysis.

The downward trend continues

While the rest of the cryptocurrency market was declining, Solana lead the way plummeting over 10% during the outage briefly falling below $40. Currently it sits around a $13 billion market cap, but has just broken to a year low to $38. It's down over 85% from its all time high of $260 in early November.

Speed and cheap gas comes at a cost

Solana is known for its lightning fast transaction speeds processing thousands of transactions a second.

Let's look at an estimated range of some other blockchain speeds for comparison:

  • Bitcoin: 3-7 TPS

  • Ethereum: 10-30 TPS

  • Solana: 1000-4000 TPS

See other blockchain current TPS Here

Although impressive, it comes at a cost. The network has seen several outages this year for a variety of reasons. A DDOS attack last month took down the network for 7 hours after bots flooded it with several million transactions a second. This was soon resolved by the development team with a restart and a patch.

This bring into question of how a "decentralized" blockchain is able make such fast changes to the network when an issue arises.

Is Solana Decentralized?

Since its inception many have question the true decentralized nature of Solana. The Solana Foundation is still in control of many of the $SOL tokens in circulation. When a restart needs to be completed, instructions are sent through their Discord for other validators to upgrade. Upgrades for other blockchains like Ethereum take many months or even years to agree upon.

While there has been many bumps in the road for Solana, only time will tell if it can survive long term.