Not so long ago, cryptocurrency was a concept shrouded in mystery. A small number of people understood what it was really about or how it worked. However, much has changed since then.
With over 18,000 virtual currencies in existence today, their total market cap exceeds $2.023 trillion. More than 8% of US citizens, including Idahoans, currently own and trade various cryptos. One of the most popular is Solana.
Continue reading to learn what makes Solana so special, how this crypto platform works, and where you can buy its native coins in Idaho.
What Is Solana?
Solana is a blockchain-based platform tailored to process smart contracts and scalable, decentralized applications called DApps. Its distinguishing features are great settlement speeds and higher transactional capacity.
Anatoly Yakovenko, a Russian computer engineer and former Qualcomm executive, conceptualized the idea for Solana in 2017. He published a white paper introducing a new concept into the crypto industry — a consensus mechanism called proof of history (PoH). This mechanism uses the passage of time and order of events to timestamp and verify transactions.
Solana uses this proof of history combined with the proof of stake mechanism to operate. PoS allows Solana validators to verify transactions based on the number of coins they hold, while PoH timestamps ensure they are verified quickly.
Solana’s blockchain was built in Solana Labs, located in San Francisco, and the project is currently run by Solana Foundation based in Geneva.
How Does Solana Work?
One of the bigger problems crypto developers have today is creating a decentralized and secure network that’s also scalable. Decentralized blockchains generally cannot scale as many transactions in a short amount of time. The reason for this issue lies in time discrepancies.
Namely, nodes in typical blockchain networks verify transactions by relying solely on their own local clocks. They have no standardized source of time to rely on. So, there’s a high chance they make completely different choices and create time discrepancies on the network.
Solana’s creators used the mentioned hybrid consensus mechanism to solve this problem. The system chooses one leader node and places it in charge of sequencing messages between the other nodes. It also facilitates the creation of the chain of transactions by hashing the output of one transaction and using it as the input for the next one. In this way, the network reduces its workload and increases its throughput.
Crypto Laws in Idaho
Virtual currencies, including Solana, represent a medium of exchange and store of value under the Idaho legislature. As such, they require you have a money transmitter license to exchange them legally within the borders of this state. However, the ID Ministry of Finance also issues no-action letters to businesses that work with virtual currencies to excuse them from these requirements regularly.
Idaho authorities recently updated these laws to include the Digital Asset Act. The act excludes digital currencies from the scope of Idaho’s securities laws. The Digital Assets Act becomes effective on July 1, 2022.
Where Can I Buy Solana in Idaho?
You can buy Solana in Idaho using two ways — via a crypto exchange platform or directly from a token holder. The two options differ substantially, so it’s best you learn more about each before making your choice. We’ll explain what they include in more detail in the paragraphs below. Stick around.
Crypto Exchange Platforms
Crypto exchange platforms are marketplaces where you can buy, sell, and exchange cryptocurrencies like Solana. They don’t differ too much from other trading platforms you might have used before. You can join them by opening an account in a couple of simple steps. Apart from trading, some allow staking cryptos or earning interest on your token holding.
Crypto exchanges can fit into two major groups — centralized and decentralized. Centralized crypto exchanges (CEX) are much more common and popular among crypto holders. They allow their users to trade cryptos for fiat currencies like USD, so they’re a great choice if you’re a beginner.
Decentralized crypto exchanges (DEX) don’t act as intermediaries in trading processes but facilitate trades through automated algorithms. They don’t allow buying or selling cryptos for fiat currencies and are generally known as less user-friendly.
If this is your first time buying cryptos, and you plan to buy Solana with fiat currencies, you’ll have to join a centralized exchange. The differences between these platforms are nuanced, so you might need some help choosing. The following guide comprises characteristics you should look for when making up your mind about the best CEX for your needs. Have a look.
- Solana availability — Look through the selection of cryptocurrencies on the platform you’d like to join. This list should include Solana and a number of other popular cryptos, so you have more trading options in the future.
- Idaho presence — Check whether the exchange you’re considering is available in Idaho and has a valid ID money transmitter license. You cannot legally use it in the Gem State otherwise.
- Security measures — Read about the security protocols of a particular platform, and find out whether it had any security breaches in the past. Your funds’ safety should always be one of your top priorities.
- Reputation — Don’t forget to do some additional research on the history of the exchange you plan to join. Current and past users’ comments and reviews should provide a good picture of how reliable one platform is.
- User-friendliness — Make sure the crypto exchange of your choice has a user-friendly interface and is well-organized. You don’t want to spend hours learning how to use it.
- Payment options — Review the list of payment methods your exchange supports. The list should include various options, including credit and debit cards, bank transfers, e-wallets, and so on.
- Liquidity — Make sure the exchange you’re joining has a high SOL trading volume. Platforms with high trading volumes guarantee better transaction speed.
- Fees — Learn about the fees you’ll be subject to when you become a member of a particular exchange. They should match the features the platform offers and fit your budget.
As mentioned, Idaho residents can also buy SOL directly from an individual willing to sell their coins. While there’s no denying that this method is less complicated, this option might not be the best. Scams are not unheard of in the crypto industry. So, unless you know the person you’re buying from, chances are you’ll get cheated out of your coins.
We suggest you stick with a CEX to be safe, especially if you’re a beginner. You can check these platforms’ licensing, reputation, and reliability beforehand to decide whether you can trust them.
Using Crypto Exchange Platforms — Step-by-Step Guide
Many crypto sector newbies tend to be apprehensive about joining and using crypto exchange platforms. However, there’s no need to worry — the procedure is quite straightforward regardless of the chosen platform. To dispel any doubts you may have, we’ll walk you through the process below:
- Pick a crypto wallet — Crypto wallets are digital addresses that allow you to safely store your coins after purchasing them. Research some of the best options on the market and choose a suitable one for your needs.
- Choose a crypto exchange — We’ve already provided you with all information you need to know about crypto exchanges. Use our advice to select the right one and visit its official website to join it.
- Open an account — Exchange platforms’ home pages typically feature a Register or Join button. Click on it to open a registration form, fill in your personal information, and submit your request.
- Verify your identity — Crypto exchanges require identity verifications as part of their KYC procedures. Follow the instructions from the website to comply with the request and activate your account.
- Make a deposit — You’ll have to top your account before proceeding with the SOL purchase. Find the list of available payment methods, select one, enter the amount you’d like to transfer, and make the transaction.
- Buy Solana — Once the funds you’ve transferred appear in your account balance, you can buy SOL. Find Solana among the cryptos the platform works with, input the number of coins you’d like to buy, and confirm your request.
- Transfer your coins — The last step in this process is choosing what you want to do with your coins next. You can trade them, stake them, or store them. If you’re not interested in the first two options, we suggest you send your coins to your e-wallet.
Solana is one of the biggest and most popular ecosystems in the crypto sector. Its innovative design, mission, and objectives make it a great alternative to other conventional cryptos on the market. So, it’s no surprise that the number of investors in this digital currency grows day by day. You can get in on the action with the help of our guides. Simply take note of our tips and step-by-step tutorial, and you’ll have your first SOL in a snap.