- SOL-USD
-1.33% - ETH-USD
-0.53% - NVDA
-0.06%
Solana (CRYPTO: SOL) is often compared to Ethereum (CRYPTO: ETH). Both blockchains support smart contracts, which are used to develop decentralized apps (dApps) and other tokenized assets, as well as staking, which allows investors to earn yield on their staked tokens.
Solana processes transactions faster than Ethereum, but Ethereum serves more developers. Solana’s bulls believe its blockchain is an “Ethereum killer.” In contrast, Ethereum’s backers believe it can stay ahead of its resilient challenger with faster network upgrades and Layer-2 rollups — which bundle together multiple transactions and process them off-chain at higher speeds. Therefore, many conversations about Solana still revolve around Ethereum.
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But during BASS, a recent gathering for Stanford’s blockchain community, Virbu Norby, the chief product officer of the non-profit Solana Foundation, claimed Solana was the “Netflix (NASDAQ: NFLX) or the Amazon(NASDAQ: AMZN) of finance”. Let’s see if that bold declaration will revive market interest in Solana, which has plummeted by roughly 60% over the past 12 months.
How can Solana become the “Netflix or Amazon of Finance”?
Norby believes that Solana can bring financial companies together on a single platform, much like how Netflix and Amazon brought movie producers and online merchants to a single platform. By following that model, Norby claims that Solana will eventually become “one marketplace where every asset and every market live together in a single place.”
So just as the internet changed how financial data was transmitted, Solana could take the next big leap forward by bringing financial assets on-chain — enabling global, near-instant transactions. Norby admitted that Solana only secures about $50 billion in network assets, which represents a tiny slice of the global financial markets. But he also declared that it was “basically inevitable” that every asset in the world would become digital and tokenized on a blockchain.
What does that vision mean for Solana’s investors?
That’s an ambitious vision, but plenty of challenges could prevent Solana from dominating that nascent market. Stablecoins, which are pegged to stable fiat currencies, are becoming a more practical choice for on-chain financial transactions than volatile tokens like Solana and Ether. Financial giants like Mastercard and Visa are already integrating stablecoins into their payment rails to enable faster, cheaper transactions.
