Kids, you remember when your dad left to go to the store and get some milk
but unfortunately he never came back?
Well, that potentially could be Solana.
It's time we talk about this dead project
and find out if your daddy's ever coming back from the store.
Let's get it!
Welcome to BitBoy Crypto!
My name is Ben.
And, today, we are talking about Solana.
This is a project that we were in very early.
From $2 on, we were talking about it was a good buy.
The tech had some issues over the years,
but, of course, with the fall of Sam Bankman-Fried,
FTX and Alameda,
everything they're invested in is troubled now.
First and foremost, Solana.
So let's get into it.
Solana was definitely one of the hottest projects during the last bull run.
Between early 2020 and late 2021,
the price climbed from $1 all the way to almost $260.
And it seemed like it wasn't just speculation at the time.
They were adding a ton of developers to the ecosystem.
They had applications that people were actually using.
And Solana was the leader in the house when it comes to being the new Ethereum killer.
Was this going to be the project that was going to take ETH out finally?
Sadly, for Solana holders, that answer is no.
You see, Solana had an inside track on Ethereum
because it was much faster and the transaction fees were much cheaper.
And this is why it made it so appealing for developers
to come over and build on the platform.
But see, then you get in to when the problems began.
The reason it was so fast and so cheap
was because the transactions were pretty centralized.
Decentralization was not prioritized on the network.
And this is the tricky thing about blockchains.
The decentralization part is what makes the user experience slow, clunky,
expensive and complicated.
But yet the decentralization is the No. 1 thing that makes this technology valuable.
It wasn't long before Solana started reaping what it sowed
when it came to its lack of prioritization on decentralization.
The low costs of fees on the network made it easy for spam and bots
to infiltrate what they had built.
And when these bot attacks occurred,
the Solana developers likened them to DDoS attacks on Solana.
In some cases, these bots would manage to shut down the entire blockchain for hours,
something that's obviously unacceptable in the world of crypto that's supposed to be 24/7.
Now, there are other rumors for what was going on when the blockchain would go down,
but hopefully we'll be able to address that in a later video.
But shutdowns like this are extremely dangerous for networks,
especially because some people have open trades on leverage on DeFi platforms
and applications built on the network.
If the market's volatile and they're unable to exit their positions,
they could end up getting liquidated.
And this happened all the time during these pauses.
Of course, then we get into the real connections between Solana and FTX.
You see, despite all these problems,
the Solana price, it kept thriving throughout the entire bull market.
And now we understand why.
It was due to market manipulation from SBF, FTX and Alameda,
which is all basically the same thing.
And when the SBF house of cards began to crumble,
things started looking quite dire for Solana.
Now, the real problems at FTX,
they started occurring in the last few months obviously.
But there was a time this year earlier when Solana was doing very well.
It was dancing around $100 and holding quite steady.
But since the real problems began at FTX,
the price has crumbled all the way down to $11 at the time of this recording.
Many people including CryptoWendyO think this thing's going all the way to $3.
That's right.
As of now, it's down 95%.
She's forecasting it to go down 98-99%.
And even in the bear market,
when the activity has been low and there hasn't been a lot of transactions or users,
the platform has still struggled to stay online
with many more pauses coming even in this bear market.
Now, the Solana co-founder Anatoly Yakovenko,
he was forced to address these concerns at the Breakpoint conference,
the Solana conference in Lisbon, Portugal.
These comments were made just days before FTX collapsed,
which very well could end up being the nail in the coffin for Solana.
In the month and a half now since FTX has filed for bankruptcy,
Solana price has continued to drop,
losing 50% of its value in just six weeks.
Now, we're getting reports that developers are leaving Solana in exodus.
A report from Token Terminal says up to 90% of the developers have left.
Now, the official Solana account, they hit back.
They said that's not true.
They claim there's 25,000 unique developers still working on the platform
citing data from the audit firm sec3,
although it seems this auditing firm is specifically focused on the Solana ecosystem.
So there might be a potential conflict of interest.
If your audit says there's no developers left
and your auditing company is all about auditing Solana platforms,
then that may not be the best way to get a lot of business.
But regardless of the exact percentage,
developers are leaving in droves.
So are projects.
And this week it was announced the top two NFT projects Y00ts and DeGods,
well, they're both going to be bridging over to Ethereum and Polygon.
Not good for Solana.
And as far as TVL, or total value locked in assets on the network is,
well, it's down 98%,
from $215 million all the way down to a measly $10 million.
I can't help but think back on the last bull run
and how all the talk was about EOS being the next big chain, or Tron.
Well, now, nobody really considers EOS or Tron to be serious Ethereum competitors.
In every bull run, it seems we have layer 1 projects come out of nowhere
offering a radically different user experience, like, now, we've got Aptos and Sui.
But these new layer 1s are always making giant compromises
when it comes to decentralization.
And that defeats the purpose.
And these projects also seem to spend a ton of money on marketing
to shortcut the system.
In my opinion, these are red flags,
and these projects, they're usually not long-term holds.
But if you're trying to take advantage of pumps,
not financial advice,
watch for these layer 1s that come out that have all the marketing
and are short on decentralization.
The hype usually leads to an upgrade in price.
But make sure to get out your of positions when everyone's euphoric
because these projects, they don't just fall to the ground.
They crash and burn.
Ethereum will not be the only layer 1 network that makes it.
But it's the sure bet right now.
There's a lot of value to capture from layer 1 investments
when it comes to the next bull run.
But when it comes to long-term holds,
you need to find the ones that have professional teams,
strong development and are actually building things and gaining users.
Don't get led astray for the latest VC toy, if you will.
Right now, we're looking at Cardano, Cosmos, Algorand, HBAR, ICP
as potential main competitors to Ethereum.
I think the most sure bet here is Cardano,
but there are a lot of strong competitors.
But by the end of the next bull run,
maybe some of those will have crashed and burned too.
But one thing's for sure,
when it comes to layer 1 investments,
when they crash,
you don't want to be left holding the bag.
That's all I got.
Be blessed.
BitBoy out.