If you are a fan of sports betting and cryptocurrencies, you might consider yourself lucky to live in South Carolina. Namely, the Palmetto State has been trying to regulate its sports betting market while also including crypto, digital, and foreign currencies as funding mechanisms. If this bill gets written into law, you will be able to use Solana, BTC, ETH, and other cryptos to place wagers on your favorite sport in South Carolina.
This article will focus on one of these cryptocurrencies — Solana. We will examine how it works, what makes it unique, who is behind it, and whether you should invest in it.
What Is Solana (SOL)?
Solana is a cryptocurrency and an open-source blockchain that utilizes new technologies to enable and host decentralized applications (DApps) and support nonfungible token (NFT) marketplaces along with decentralized finance solutions (DeFi).
A former Qualcomm and Dropbox employee, Anatoly Yakovenko, created the whitepaper in 2017, which later evolved into Solana as we know it today. Solana was launched in March 2020. It’s no wonder it quickly became a head-turner and one of the most prominent blockchain projects since it is highly scalable, secure, cost-effective, and completely decentralized.
This scalability is what makes Solana unique. Namely, this crypto project uses an innovative consensus model, which is a combination of a proof-of-history (PoH) algorithm and a synchronization engine (a version of proof-of-stake (PoS)). Therefore, Solana can process an impressive number of transactions per second without incurring high costs. This scalability represents one of the biggest challenges for decentralized blockchains. However, since Solana has managed to achieve it, it represents an ideal solution.
Since its launch in 2017, Solana has raised more than $25 million through multiple private and public sales rounds. Its blockchain is built at the San Francisco-based Solana Labs, run by the Geneva-based Solana Foundation.
How Does Solana Work?
Solana relies on the unique proof-of-history (PoH) consensus model. It is combined not only with a widely known proof-of-stake mechanism but also with a time component, which is entirely new to the crypto market.
PoH is a record of earlier blockchain activities. It keeps track of events as they occur. The creator of Solana, Anatoly Yakovenko, explained in the whitepaper that every node in the network has its own clock. Thus, it is easy to verify events and track time progression.
All these technologies involved in Solana’s network may seem quite complex. Therefore, the whole concept might be a lot to grasp for people who aren’t tech-savvy. What matters the most is that regular crypto enthusiasts and institutional traders find Solana attractive. Essentially, this blockchain and its caretaker, the Solana Foundation, are on a mission to enable much broader use of DApps than before.
Solana is primarily focused on developing decentralized apps. In this case, the speed is crucial, which is why it comes as no surprise that Solana has much faster transaction speeds than Ethereum. Plus, it can process more than 65,000 transactions per second. Another unique element of this blockchain is the average block time, which spans from 400 to 800 milliseconds.
Its perfect scalability and speed make this network suitable for supporting thousands of decentralized app users simultaneously without a hitch. In addition, Solana accomplishes all of this without sharding or using third-party technologies that are not part of the core network. This is a big deal since only a handful of blockchains can achieve this without extra features.
Solana vs. Ethereum
Solana and Ethereum are the top cryptos in the market and are considered each other’s biggest competitors. However, your personal preferences play a major role in determining which one is better. Do you need a more secure but costly blockchain, or are speed and cost-efficiency more important to you? Either way, let’s see in what ways they are similar and what sets them apart.
Ethereum uses a proof-of-work (PoW) mechanism secured by hundreds of miners. This technology is also utilized by Bitcoin. On the other hand, in Solana, the time gap between two events is determined by a number of sequential computational steps, and each transaction is given a time stamp. This mechanism is called proof-of-history (PoH).
Crypto investors are well aware that speed is Solana’s main asset. We’ve already mentioned that It is capable of processing 65,000 transactions per second, while Ethereum can process only 30. Plus, Solana’s block time is 1 second, whereas Ethereum’s is 15. While Ethereum charges a lot for its transactions, Solana’s average fee is only $0.00025.
However, Solana has only been on the market for the past two years, and Ethereum has been around since 2014. Thus, Solana still has to prove itself in terms of maintaining proper transparency about its developers, market cap, and network size.
SOL Token Explained
Solana’s native token is called the SOL coin. SOL is used across the Solana network for all transactions and smart contracts. Additionally, token holders can stake the token to help secure the network. If you decide to do this, you will receive more SOL tokens as a reward. Taking part in staking will also allow you to participate in network governance in the future.
You can purchase SOL tokens with fiat currency or other cryptocurrencies. In addition, you can also trade, sell, or invest in it.
Solana’s position as one of the top 10 cryptos globally and its unlimited token supply make it an attractive investment. Approximately 511 million SOL tokens have been created, with more than 346 million in circulation.
Its market cap is close to 14 billion, and its current worth is $40.26 (as of August 2022). However, since the numbers can change within seconds, it is best to refer to sites such as CoinMarketCap to stay in the loop with price fluctuations.
Crypto Laws in South Carolina
The Palmetto State may be among the last ones to implement money transmitter licensing and regulations, but that doesn’t make it any less crypto-friendly. The regulations became effective in June 2018, and since then, many crypto exchanges have been operating smoothly within the state.
South Carolina has recognized the importance of adopting this emerging trend. In its attempt to become the capital of blockchain technology, the state passed a resolution in 2020 to acknowledge its importance and encourage the residents to promote it further.
One of the latest regulations from 2022 aims to bring regulated sports betting to the Palmetto State with some special provisions. These refer to permitting the use of digital currencies for account funding. Namely, both cash and cash equivalents are defined as account funding options, so Bipartisan House Bill 5277 perceives foreign and virtual/digital currencies as cash equivalents.
Where Can I Buy Solana in South Carolina?
Centralized and decentralized cryptocurrency exchanges are two of the most popular methods you can use to buy cryptocurrency.
You do not have to submit personal information to register with decentralized exchanges, which allows you to maintain anonymity. The downside is that they only accept cryptocurrencies, so you cannot use fiat money on them. Moreover, they don’t comply with South Carolina’s crypto laws and regulations.
The only way for individuals or companies to sell crypto legally in South Carolina is to have a money transmitter license. As a result, centralized crypto exchanges are your best bet. In addition to being regulated and safe, they allow you to purchase SOL using traditional currencies. The downside is that you cannot use them anonymously.
Centralized Crypto Exchanges
A centralized cryptocurrency exchange is the safest way to purchase SOL tokens in South Carolina. You can buy and sell cryptos and digital assets on these platforms. Basically, they act as middlemen between buyers and sellers. They are centralized because companies own them. Plus, they are held accountable for their clients’ assets, which makes them more trustworthy.
SOL tokens are available on some of the most popular exchanges in the Palmetto State, including Kraken, Coinmama, Gemini, Etoro, Coinbase, and Binance. To select the right one, you must keep the following factors in mind:
- Availability in South Carolina — Some exchanges may not be available to residents of South Carolina. Make sure you can access the one you choose.
- Accepted cryptocurrencies — It is essential that the platform you opt for supports the Solana token.
- Security and privacy — Your main concern should be ensuring the exchange utilizes top-notch security. Check whether the platform you have opted for uses encryption and firewalls to protect your financial and personal information.
- Reputation — Read reviews and feedback from other users to determine whether they recommend it.
- Liquidity — Liquidity will allow you to conduct transactions more quickly, easily, and efficiently without too much volatility in terms of price. Also, look for a platform that offers guaranteed pricing or locked-in trades.
- Fees — Each exchange charges differently. There is a set fee in some cases, while in others, you are charged a percentage. In addition, the fee also varies based on whether you are a buyer or a seller. Either way, many exchanges usually charge transaction and conversion fees.
- Limits — Exchanges can limit the amount you buy and sell over a given period. Consider that when opening an account.
- Payment methods — Cryptocurrency exchanges accept different payment methods. Make sure to choose the one that allows the method you usually use.
- User interface — The user interface should be easy to navigate on desktops and mobile devices alike. This will facilitate website navigation and create a good user experience.
If you do not wish to go through the verification process of a crypto exchange, you can purchase SOL tokens directly from another seller. Even though this may be a more affordable and easier option, it is riskier.
Still, in case you choose to go down this path, you should keep a few things in mind — when purchasing SOL coins, it is recommended to do some research and buy them from a trustworthy person only.
Of course, we feel obligated to tell you that trading with an individual may turn out to be a scam, so it’s safer to do all business through exchanges.
How to Buy SOL on an Exchange — Step-By-Step Process
Exchanges make it relatively easy to purchase and sell SOL tokens.
To help you get started, here is a step-by-step guide:
- Set up a wallet — Make sure to find the right wallet for your needs. Once you research the supported wallets, choosing the perfect one is easy.
- Pick an exchange — Ensure that your exchange is available in South Carolina and that it meets your preferences and requirements. You can also check out our recommendations.
- Register an account — Complete the KYC process by providing all required documents.
- Make a deposit — Select your preferred method of depositing fiat money for the later purchase of SOL coins.
- Purchase SOL — Add funds to your account to exchange them for SOL coins. Remember that transaction and conversion fees will apply.
- Transfer SOL to your wallet — Your wallet now contains Solana tokens that you’ve purchased through your exchange account. Depending on what you plan to do with the funds, you can withdraw them to your wallet or leave them there.
Solana is one of the newest cryptocurrencies on the market. Still, it has managed to get the attention of investors. South Carolina’s laws allow you to purchase it legally through exchange platforms or directly from a seller. So, if you have decided that Solana is the next investment you want to make, our guide will help you obtain your first SOL in no time. Good luck!