Bank of America (BofA) believes that the Solana blockchain can become the “Visa for the Digital Asset Ecosystem”.
That’s because, according to the entity, the platform focuses on scalability, low transaction fees and ease of use.
The claims were made by BofA analyst Alkesh Shah in a research note sent to clients on Tuesday (11).
By way of comparison, the Solana network has already settled over 50 billion transactions since it launched in 2020. Meanwhile, Visa processed 164.7 billion transactions in 2021 as of September 30th.
Solana is praised by Bank of America analyst
Furthermore, the total amount blocked (TVL) on the Solana blockchain exceeds $9.93 billion, according to data from the DeFi Llama. Also, another 5.7 million NFTs were minted on the SOL network, as Shah informed in the note to customers.
Solana’s price has also skyrocketed in recent times despite a pullback earlier this year. Since January 1, 2021, the price of SOL has jumped by more than 6,500%. The cryptocurrency is currently trading at $147.
The BofA analyst also said that Solana is mainly used by consumers, such as micropayments and in games.
“Solana prioritizes scalability. But a relatively less decentralized and secure blockchain has tradeoffs, illustrated by a number of network performance issues early on,” Shah pondered in the note.
In fact, Solana has faced several episodes of DDoS attacks and performances. On the fourth day of this year, the network suffered his third such attack in less than a month.
On the other hand, analyst Shah pointed out the advantages and challenges of the ETH network, Solana’s main “competitor”:
“ETH prioritizes decentralization and security, but at the expense of scalability, which has led to periods of network congestion and transaction fees that are occasionally greater than the value of the transaction being sent.”
Due to these ETH network challenges, BofA’s analysis believes that Solana and other blockchains can gain more market share from ETH over time. In addition, they can be differentiated by user adoption and developer interest.