A lot can happen in one year. The gains in cryptocurrencies are the perfect example of that. The world's first cryptocurrency Bitcoin soared past $60,000. And many smaller players skyrocketed, turning pocket change into a fortune.
One of this year's most-talked-about names has been Solana (SOL -2.27%). The young cryptocurrency has pretty solid reasons for garnering such attention. It's a blockchain that's climbing the ranks in non-fungible token (NFT) sales and is known for its high transaction speed.
Early investors in Solana are probably celebrating right now. Why? Because an investment at the start of the year quickly brought major returns. Let's see how much you would have today if you'd invested in Solana at the start of January.
In early January, Solana traded for $1.59. If you invested $100 then, you would have purchased 63 SOL, the native token of Solana. Today, Solana is trading at about $187. That's a gain of more than 11,000%. And that means your investment now would be worth $11,781.
Solana actually peaked last month at about $257. If you'd sold then, you would have made about $16,000. Pretty impressive, right?
If you're still holding onto your Solana investment -- or considering buying now -- you may be wondering if there's much potential for further gains. Of course, there's a lot of competition in the cryptocurrency space. There are the two leaders -- Bitcoin and Ethereum. And there are thousands of others quickly advancing when it comes to users, investors, and market value.
Right now, Solana is ranked No. 5, according to market value. So it's definitely made its way into the territory of the elite in the crypto world. Can it stay or move higher? The clues we have so far are positive.
First, there's the idea of high transaction speeds at a low cost. Right now, Solana can process more than 2,000 transactions per second at an average cost of $0.00025 per transaction. But Solana's architecture means it eventually can accommodate more than 700,000 transactions per second.
The blockchain's method of validating transactions is one of the secrets of this success. Solana uses the proof-of-history technique. This method marks blocks of data with a timestamp of sorts -- the result is quick and seamless validation.
An NFT leader
Second, Solana's progressed a great deal in the area of NFTs. These are certificates of ownership of everything from sports-fan tokens to artwork. Solana ranks No. 3 by NFT sales volume over the past seven days, according to CryptoSlam.
Solana's presence is strong in decentralized applications (dApps). Today, more than 400 projects exist on the blockchain. They span a variety of areas including gaming and finance. In fact, decentralized finance has the biggest share of projects with a total of 167.
There's a lot happening on the Solana blockchain right now. And technically, Solana still is in the beta stage. That means there's probably a lot more ahead for Solana, too.
It's important to remember that all cryptocurrencies remain risky because we don't yet have a clear picture of the role they'll play a few years down the road. And Solana, as a new crypto, faces potential challenges as it expands. But the progress it has made so far is reason to be optimistic about its future.