• January 12, 2022

Solana Could Become the Visa of Digital-Asset World: Bank of America.

In a research note, the bank predicted that Solana and other blockchains may snag market share from Ethereum over time.

After hosting Solana Foundation member Lily Liu, Bank of America informed clients in a research note that the Solana blockchain might become the "Visa of the digital asset ecosystem" since it focuses on scalability, cheap transaction fees, and ease of use.

Since its launch in 2020, Solana has seen rapid adoption. Analyst Alkesh Shah wrote in a note published Tuesday that it has settled over 50 billion transactions (Visa, the global payments giant, processed 164.7 billion transactions in the year ended Sept. 30), has more than $11 billion in total value locked, and has been used to mint more than 5.7 million non-fungible tokens (NFTs). Solana is designed for consumer use cases like micropayments and gaming, according to the bank.

"While Solana promotes scalability, a less decentralised and secure blockchain comes with trade-offs, as evidenced by multiple network performance concerns since its launch," Shah explained. "Ethereum values decentralisation and security over scalability, resulting in periods of network congestion and transaction fees that are sometimes greater than the value of the transaction being sent."

Solana and other blockchains, according to Bank of America, might eat into Ethereum's market share over time, and will begin to distinguish themselves through user acceptance and developer engagement.