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How to buy Solana

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Solana is a leading blockchain platform and a growing rival to Ethereum. While Solana claims to be the fastest blockchain in the world, the popularity and scalability of the platform has made its native token, SOL, one of the top 10 cryptocurrencies by market capitalization.

Compared to well-known cryptocurrencies like Bitcoin and Ethereum, Solana’s price is relatively low, trading at around $40 at the time of this writing, making it an attractive option for new investors. If you want to invest in Solana, here’s what you need to know to buy and sell SOL.

What is Solana?

With a name inspired by a region of the California coast, Project Solana was launched in 2017 by Anatoly Yakovenko, who once led operating systems development at Qualcomm.

So how does Solana compare to other cryptos? Yakovenko discovered that Bitcoin and Ethereum had scalability issues. Back then, they couldn’t process more than 15 transactions per second (TPS).

The former Qualcomm engineer designed Solana, a Layer 1 protocol, to be a blockchain platform that could host decentralized and scalable applications at much faster rates and at lower cost.

The key innovation of this crypto is its “proof of history” (POH). The POH is not a consensus mechanism like Proof of Work or Proof of Stake. Instead, it’s a system that runs around a “crypto clock.” Each Solana node maintains its own clock, encoding the passage of time in SHA-256 encryption, a widely used hashing algorithm.

As of May 2022, Solana was processing an average of 2,700 TPS. Its super-fast processing times make it attractive to developers, who hope its low fees will make it competitive with centralized payment processors in the future.

Today, Solana is used to support decentralized finance projects, including non-fungible tokens (NFTs), decentralized application developments (also known as dApps), and smart contracts. According to Yakovenko, more than 15 million NFTs are listed on Solana at the end of June.

The Solana token SOL is a native cryptographic token used for transactions on the blockchain, including micropayments. Users can also delegate and stake SOL for additional rewards. Currently, there is a supply of 342 million SOL with a total supply of 508 million.

Where can I buy Solana?

To buy the Solana SOL token, you need to open an account with a crypto exchange. Major exchanges that allow users to buy and sell SOL with US fiat currency (USD) include:

With some cryptocurrency exchanges, you can buy and sell Solana paired with Tether (USDT), a stablecoin. If you are relatively new to the world of cryptocurrency, a stablecoin is a relatively safe cryptocurrency with a more stable valuation.

Exchanges that combine SOL and USDT include:

How to buy Solana (SOL)

To buy SOL tokens, follow these three simple steps:

1. Choose a crypto exchange

Crypto exchanges are platforms that facilitate cryptocurrency trading, acting as an intermediary between buyers and sellers. Some exchanges are simple, but others are more suitable for experienced investors.

When comparing your options, look for a crypto exchange that offers low account minimums and transaction fees. To help you get started, we researched the options available and selected the best cryptocurrency exchanges.

2. Buy SOIL

Once you have an account, you need to fund it. You can fund your account with existing cryptocurrency holdings or you can fund it with your bank account or debit card.

Some cryptocurrency exchanges allow you to buy cryptocurrencies with a credit card, but you should think twice before using this payment method; the credit card company will likely treat the transaction as a cash advance, and you’ll have to pay a cash advance fee and a higher annual percentage rate (APR). Additionally, going into debt to invest, especially in cryptocurrencies, can be volatile.

Once your account is credited, you can place your first order. Just type Solana’s stock symbol – SOL – and the amount you want to invest, for example $25 or $50. Typically, you can select an order type, such as a market or limit order.

3. Store your SOL

When investing in Solana or other cryptocurrencies, you must store your tokens using a crypto wallet.

Several storage options are available; which are best for you is based on your level of risk tolerance and the intended use for your cryptocurrency:

  • Hardware wallets. A hardware wallet is a physical device that looks like a flash drive. Unlike other storage options, hardware wallets are not connected to a network or the internet, so they are considered “cold” storage and are generally more secure.
  • paper wallets. As the name suggests, a paper wallet secures your private keys on a piece of paper or with a printed QR code. If you decide to use a paper wallet, have a plan in place for where to store it; if you lose this paper, you will not be able to regain access to your cryptocurrency.
  • Software wallets. You may prefer a software wallet if you want more convenient ways to access your cryptocurrency and buy and sell your holdings. With this option, you use downloadable software or app to store your crypto. The software is connected to the Internet, so it is less secure than hardware or paper wallets, but you can use your cryptocurrency more easily.
  • Crypto Exchanges. Some crypto exchanges, such as CoinBase, will store your crypto holdings. However, relying on an exchange to handle storage can be risky, and it’s usually only a good idea for small amounts and short periods of time.

What you can buy with Solana

Solana has a maximum supply of 508 million tokens. If you buy the Solana token, you can use SOL to pay transaction fees for executing smart contracts or other transactions. It can also be used for staking, where you can stake your SOL tokens and earn rewards.

As with any cryptocurrency, investing in SOL can be risky. Only invest what you can afford, as your investment may lose value.

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