The Solana cryptocurrency blockchain suffered its 2nd outage in May leading to the entire networkbeing halted. During the halt, prices of Solana dropped more than 12% and applications that rely on Solana were taken offline. Solana continues to be plagued with issues that cause the chain to be halted.
It took around 4 and 1/2 hours for the Solana validators to be restarted. During this period no transactions could be processed.
What Is Solana?
Solana is one of the largest crypto blockchains by market cap and is an alternative to the Ethereum blockchain. Solana aims to achieve high transaction speeds and uses a novel “proof of history” mechanism combined with proof-of-stake. The Solana blockchain uses its native cryptocurrency, $SOL, to pay transactions and fees.
The Solana platform has smart contracts that allow for it to have decentralized exchanges (DEX) and non-fungible tokens (NFT).
Solana supporters like to point out that Solana is able to process around 50,000 transactions a second compared to only 15-30 per second on Ethereum. The high transaction rate also allows for low fees on the Solana network. Additionally, Solana was in the group of ‘potential ETH-killer’ alternative chains.
The proof-of-history (PoH) validation method, each transaction and event on the blockchain gets a unique hash and count. This is done through a verifiable delay function (VDF). If you know these for an event, you can figure out what had to occur right before and after it. Therefore, the VDF allows for validators to reconstruct the order of events.
Criticisms of Solana
In addition to the continued network outages, there are other criticisms of the Solana blockchain.
First, Solana claims to be decentralized, but as shown during the outages, the Solana blockchain has a centralized entity. This entity is able to halt the chain, reorganize and fix any issues, send out new versions to the validators and restart.
Secondly, there is a very low amount of validators. Solana claims thy have over 1,000 independent validators. However, people critical to Solana point out that there are really 4 main validators and many inconsequential validators on the chain.
8th Failue of Solana Network
The most recent outage of the Solana blockchain is the 8th time the network was halted. (You can search for solana blocks here). As noted by the official Solana network twitter.
There is some debate around what constitutes a system ‘failure’ and if the real number issomething less than 8. However, there is little debate that the network issues are occuring at too frequent of a pace for comfort.
Having a high throughput of transactions is great. Being able to match transactions per second with large, established, and centralized services like Visa & Mastercard would be wonderful for being able to handle more widespread adoption. But if the network is down frequently it negates a lot of the benefit of being fast.
Solana isn’t immune to other hacks either. The Solana side of the bridge was the one compromised in the $325 million Wormhole hack.
Why Does Solana Keep Being Halted & Failing?
The most recent Solana halt was due to a bug in the durable nonce transactions features. Two validator nodes generated different results for the same block which stopped the network from advancing.
The Solan engineers released a new version that disabled the durable nonce transactions features to allow the network to start back up. In total the network was down for approximately 4 hours.
Solana was offline for 17 hours back on September 14th, 2021. The cause of the network stalling was bots generating transactions during a protocol launch. The bots overloaded the memory of the network and caused validators to not reach an agreement. This was likened to a non-malicious DDoS attack.
Solana outage and degraded performance incidents since January 2022 are being tracked in a public page. By Solana’s own records there have been 6 major issues/outages and 20 periods of degraded performance year-to-date as of June 1, 2022.
The outages have been driven by upgrade issues, issues with reflecting the correct time on transactions, nodes improperly creating forks due to updates not syncing, transactions being duplicated erroneously, and the RPC being spammed.
Summary: Solana Outage Issues Continue
Solana remains the 9th largest crypto at nearly a $13 Billion market cap. Some of the previous network issues did not lead to large prices changes, but this most recent outage lead to a large decrease in the price.
It is yet to be seen if Solana is able to correct over the longterm and continue to grow in populatrity or if the continued issues are driving users away. The continued network downtime is concerning as Ethereum is preparing for major upgrades that will drastically expand its transactions per second. Additionally, Ethereum has a number of L2 scaling solutions already available that can help decrease the burden on the mainnet chain.