Why Bank Of America Says Solana Could Become The ‘Visa Of Crypto’ | Benzinga

Strategists at Bank of America Corp (NYSE:BAC) foresee a future when high-speed blockchain Solana (CRYPTO: SOL) could become the Visa Inc (NYSE:V) of the digital asset ecosystem.

What Happened: According to a  Jan. 11 research note seen by Business Insider, Bank of America analyst Alkesh Shah hypothesized that Solana’s low transaction fees, ease of use and scalability could help it take market share away from Ethereum (CRYPTO: ETH).

“Its ability to provide high throughput, low cost and ease of use creates a blockchain optimized for consumer use cases like micropayments, DeFi, NFTs, decentralized networks (Web3), and gaming,” stated Shah.

Since its launch in March 2020, the Solana blockchain has settled more than 50 billion transactions and has been used to mint more than 5 million NFTs.

Visa says it is capable of handling more than 24,000 transactions per second (TPS), while Solana boasts a transaction speed of 65,000 TPS.

Meanwhile, the most widely used smart contract network Ethereum currently handles just 12 TPS on its mainnet — although this number is significantly higher with the help of Layer 2 blockchains such as Polygon (CRYPTO: MATIC).

“Ethereum prioritizes decentralization and security, but at the expense of scalability, which has led to periods of network congestion and transaction fees that are occasionally larger than the value of the transaction being sent,” wrote Shah.

“Solana prioritizes scalability, but a relatively less decentralized and secure blockchain has tradeoffs, illustrated by several network performance issues since inception.”

Over the last year, Solana has faced network outage issues on three separate occasions. The most recent outage was reported earlier this month with congestion allegedly caused by “mis metered transactions.”

Price Action: As of Thursday morning, SOL was trading at $156.95, up 6.28% in the last 24 hours. SOL has appreciated by more than 30,000% since May 2020. The cryptocurrency is down by at least 41.7% from its all-time high of $259 in November 2021.

Photo by Shubham Dhage on Unsplash

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