Solana (SOL)

Solana (SOL) is built for speed: it aims to process thousands of transactions per second at negligible cost, making it the chain of choice for high-frequency DeFi trading, consumer crypto apps and — notably — the bulk of meme-coin activity.

After a near-death experience during the FTX collapse (Solana's biggest outside supporter), the network rebuilt, grew dramatically, and cemented itself as the number-two smart-contract ecosystem after Ethereum.

Solana is a single, high-throughput blockchain where all activity happens on one layer rather than being split across rollups. Its native token, SOL, pays transaction fees and secures the network through staking.

The network's design trades some decentralisation for performance: validator hardware requirements are higher and the validator set smaller than Ethereum's, but the result is a very fast, cheap user experience.

Solana combines Proof of Stake with a technique called Proof of History, a cryptographic clock that lets validators agree on the ordering of transactions with minimal back-and-forth. Blocks are produced roughly every 400 milliseconds.

Validators stake SOL and vote on blocks; stakers earn rewards from new SOL issuance. Unlike Ethereum, Solana does not burn a base fee on every transaction by default — fees are simply very low.

Historic criticism of Solana has centred on several major network outages in 2021–2023. Reliability improved substantially after a series of client upgrades, and the network has operated without a major halt for an extended period.

Solana was founded by Anatoly Yakovenko, with a whitepaper published in 2017 and mainnet launch in March 2020.

The chain boomed in 2021 (DeFi and NFT summer), then suffered a brutal drawdown in late 2022 when FTX — a major backer — collapsed. A strong rebuild followed from 2023 onward, with user activity and developer adoption returning to new highs, and Solana becoming the primary venue for retail token launches and high-frequency on-chain trading.

SOL has no hard supply cap. New SOL is issued as staking rewards under a disinflationary schedule — the inflation rate started at 8% per year and decreases annually toward a long-term terminal rate — while some fee mechanisms remove a small amount of SOL from circulation.

Live circulating supply and market capitalisation are shown in the pricing data above.

SOL is listed on AUSTRAC-registered exchanges with AUD deposits via PayID or bank transfer, and is among the most liquid crypto assets available to Australians.

The ATO treats SOL as a CGT asset. Swaps, sales and spending are disposals; staking rewards are generally ordinary income when received. Because Solana encourages active on-chain use, Australians trading frequently should use tracking software to keep CGT records.

Key risks: extreme volatility; historical network outages (though long resolved, they show the risk profile); validator concentration and hardware demands; exposure to speculative cycles (meme-token frenzies can inflate and then drain fee revenue and attention); and smart-contract exploits across its DeFi ecosystem.

Staking SOL involves lock-up/delegation mechanics and slashing-free but inflation-driven dilution if unstaked. Never invest more than you can afford to lose.