Recently, investing in virtual currencies has become all the rage in the business world. There are thousands of them on the market, and new ones keep popping up regularly. Still, a couple of cryptos stand out in this sea of digital gold. The one we’ll be discussing today is Solana.
Solana is more than a cryptocurrency. It’s a blockchain-based project that sparked the interest of many traders and investors worldwide, Louisiana included.
If you’re from the Pelican State and would like to purchase Solana, this page is the place to be. Stay with us and learn what Solana is, how it works, and where you can buy it in Louisiana.
What Is Solana (SOL)?
Solana is an open-source, blockchain-based network built to support smart contracts, decentralized apps (DApps), and non-fungible tokens (NFTs). Solana’s native token is called SOL. It’s both a means of transferring value and a utility token. You can buy, sell, and trade it for other cryptocurrencies or stake it to provide security to the Solana network.
The idea for the Solana project comes from a Russian executive — Anatoly Yakovenko. His background in system design helped him think out of the box regarding blockchain technology. As a result, he published a white paper introducing a new concept into the crypto world and hypothesized a solution to the blockchain trilemma.
Yakovenko launched Solana in 2020 with the help of a couple of colleagues. This crypto started small but reached global popularity in less than a year. Solana has been in the world’s top 10 cryptocurrencies by market cap ever since.
What Makes Solana Special?
To help you understand the value of Solana, we have to go back to a concept we’ve mentioned above — the blockchain trilemma.
This phrase was coined by Vitalik Buterin, one of the co-founders of Ethereum. It refers to the three main issues blockchain developers face today — decentralization, scalability, and security.
The trilemma lies in the belief that these traits are mutually exclusive. To that end, developers have to sacrifice one of them to keep the other two when building blockchains.
For example, the Bitcoin network gave up on scalability for security and decentralization. In contrast, XRP relinquished decentralization to keep its network secure and scalable.
However, Solana doesn’t toe this line. According to its creators, Solana’s design allows this network to solve the trilemma and be decentralized, scalable, and secure at the same time. The secret behind its design lies in combining two types of consensus mechanisms — proof-of-stake (PoS) and proof-of-history (PoH).
PoH is a method that verifies transactions by recording the order and passage of time between events on the network. PoS allows validators to stake SOL and chooses a leader among those nodes based on the number of staked coins. The leader validator uses the PoH record as a time source to add new blocks to the chain. The rest of the validators follow along, creating a chain of transactions.
This system makes each node’s task more clearly defined and accelerates the transaction verification process. It also helps increase throughput and lower latency on the network.
Crypto Laws in Louisiana
Louisiana started regulating its crypto market in 2020 when it passed the Virtual Currency Business Act. The act defines virtual currency as a digital representation of value that can be used as a unit of account, medium of exchange, or store of value.
This piece of legislation establishes that all residents of Louisiana who intend to engage in virtual currency business activity must obtain a LA virtual currency license. Under this law, virtual currency business activity includes:
- Storing, exchanging, or transferring virtual currency or engaging in virtual currency administration
- Holding digital precious metals or certificates that represent an interest in digital precious metals on behalf of another person
- Issuing shares or certificates representing digital precious metals
- Exchanging one or more virtual currencies in one or more online games, families of games, or game platforms
This act’s definition of Louisiana residents includes people who live in the state, have business there, or are physically located there for more than 183 days.
The Virtual Currency Business Act does include one important exception. Individuals and small businesses that exchange less than $35,000 worth of virtual currencies a year don’t have to obtain the mentioned license.
Where Can I Buy Solana in Louisiana?
Louisiana residents have a wide choice of places where they can buy Solana, thanks to the above-discussed legislation. They just have to make sure the business or person they’re buying from has a LA virtual currency license or proof they are exempt from obtaining it.
The most common ways Louisiana crypto buyers acquire Solana include exchange platforms or SOL holders willing to sell their coins. If you’re not sure what these two options comprise, check out the following paragraphs.
Crypto Exchange Platforms
Crypto exchanges are platforms where you can purchase, sell, or exchange cryptocurrencies. They can be decentralized and centralized. Decentralized exchanges don’t rely on an intermediary organization to clear transactions. Instead, they facilitate trading by using smart contracts. This approach to trading makes decentralized exchanges less secure and less popular than their centralized equivalents.
Centralized exchanges are owned and operated by a single authority and function similarly to fiat currency exchanges. They are regulated, licensed, and allow you to exchange cryptos for fiat money.
If this is your first time buying cryptos, we recommend choosing a centralized exchange platform. You’ll be able to buy SOL for fiat currencies on them, and they’ll keep your funds safer.
How to Choose a Centralized Crypto Exchange
The Louisiana crypto market doesn’t skimp on centralized crypto exchanges. Some of the best exchange platforms are available in this state, so you’ll have many quality options to choose from.
However, being this spoiled for choice might feel overwhelming if you’re a beginner. We’ve compiled a list of essential characteristics all good centralized crypto exchanges need to have to help you out. Read through the list, and you’ll be all set.
- Louisiana license — Make sure the platform you’re choosing has a valid virtual currency license from Louisiana or proof of an exemption from one. In this way, you’ll ensure the organization is trustworthy and legal.
- Crypto availability — Check the list of cryptocurrencies that the exchange you’re planning to join supports. The list should include SOL and other popular cryptos you might want to trade in the future.
- Reliability — Gather as much information as you can about the exchange you’re picking. You can find user reviews online, read about the platform’s security measures, and learn about its history with cyber attacks. This information will help you determine whether the organization is genuinely reliable.
- Liquidity — Take heed of the SOL trading volumes the crypto exchange you’re considering boasts. High SOL trading volumes will allow you to enjoy fast transactions whenever you trade your coins.
- Payment methods — Don’t forget to check what payment companies collaborate with the platform of your choice. As you might imagine, picking the ones that offer numerous diverse payment methods is always a better option.
- Fees — Pay close attention to the fees the platform you’re joining imposes on its users. You should be aware of the costs you will bear when trading.
Buying SOL Directly
As mentioned, you can also buy Solana from a person who holds these coins and is willing to sell them to you. This might be a better choice than crypto exchanges if you’re trying to avoid fees and you’d like to haggle over crypto prices. However, it doesn’t come close to a crypto exchange with regard to safety.
There’s a high risk you’ll get scammed, especially if you’re new to the industry. So, unless you know the person selling the coins, we suggest sticking with centralized exchanges.
How to Buy SOL — Step-by-Step Tutorial
All centralized crypto exchange platforms work more or less the same. So, you’ll find all the help you can need to buy SOL in our guide below. Have a look:
- Do some research and choose a crypto wallet where you’d like to store your SOL.
- Pick a crypto exchange platform following our advice.
- Create an account by filling out the registration form and verifying your identity.
- Log into your account, find the Deposit section, and select the payment method you’d like to use.
- Enter the amount you want to transfer and submit your request.
- Find the right fiat/cryptocurrency pairing, input the number of coins you want to buy, and confirm the transaction.
- Use the coins you’ve bought to trade further or send them to your crypto wallet.
Solana hasn’t been a part of the crypto industry for a long time, but it has already managed to gain widespread popularity. It ranks in the top ten cryptocurrencies in the world for a reason. It’s decentralized, secure, and incredibly scalable. If these traits are enough to sway you into investing in Solana, nothing is stopping you. Choose a crypto exchange, create an account, and start your SOL crypto journey!