Solana is an open-source blockchain platform designed to support decentralized applications (dApps) and cryptocurrencies. Launched in 2020 by the Solana Foundation, this project has established itself as an attractive option for developers and users, thanks to its focus on solving one of the biggest problems of traditional blockchain networks: scalability.
- Name: Solana
- Ticker: SOL
- Launch year: 2020
- Current supply: 618.09M
If you are interested in earning rewards with your cryptocurrencies, you have surely heard the term mining. Miners solve complex mathematical problems to validate transactions and protect the network. However, this process requires a large amount of computing power, which generates high energy consumption and elevated hardware costs.
So, can mining be used to acquire more SOL tokens? No, you cannot mine Solana in the traditional sense. Unlike cryptocurrencies based on Proof-of-Work (PoW), which can be mined, Solana uses a Proof-of-Stake (PoS) mechanism that works differently.
Therefore, you can still earn rewards on the Solana blockchain through staking, which is part of the PoS mechanism. This process consists of assigning part of your SOL tokens to a validator that is responsible for verifying transactions and helping to protect the network. Validators receive transaction fees in exchange for their work, and a portion of those fees is divided proportionally among users who delegated their SOL tokens to that validator.
How Solana Works: Staking, Validators, and Proof of History
Solana works by combining Proof of Stake (PoS) for consensus and Proof of History (PoH) for speed, where validators lock (stake) SOL tokens to process transactions and secure the network, receiving rewards.
PoH acts as a cryptographic clock, sealing the time between events so that validators do not need to agree on the order, allowing ultra-fast validation, which results in high scalability and low fees.
From Mining to Staking: What Changes
The shift from mining to staking represents a move from physical and computational effort to financial commitment. While in the PoW system security depends on machine power, in PoS energy expenditure is replaced by the locking of coins as collateral, seeking a more sustainable and accessible model.
|
Characteristic |
Proof of Work (PoW) |
Proof of Stake (PoS) |
| Validation Process | Solving complex mathematical puzzles. | Staking existing coins. |
| Reward | The first miner to solve the problem receives the prize. | Selection based on the amount of coins staked. |
| Energy Consumption | Very high: Requires competitive, massive computing power. | Low: Does not require intensive computing processes. |
| Hardware | Requires specialized equipment (ASICs, powerful GPUs). | Does not require specialized hardware; greater accessibility. |
| Main Risk | Negative environmental impact and entry barriers due to costs. | Risk of centralization (those with more coins have more power). |
| Current Use | Proven and secure method; used by Bitcoin. | Preferred by new projects for its scalability and sustainability. |
The Role of Validators in Solana
The Solana network operates with a high level of efficiency and security, largely thanks to the crucial role played by validators. These validators are essential components for maintaining the functionality, security, and decentralization of the blockchain.
The main function of validators is to support the operation of the blockchain by validating transactions and contributing to the network’s consensus mechanism. This mechanism allows the blockchain to confirm transactions and maintain its state across all nodes. One of Solana’s unique features is the implementation of the Proof of History (PoH) consensus mechanism, which allows the network to achieve high performance and scalability. Validators play a key role in this mechanism by processing transactions in chronological order, thus ensuring the speed and efficiency of the network.
Validators contribute to the decentralization of the Solana network by operating independently, thereby ensuring the absence of single points of failure and control within the ecosystem. Their operation is fundamental for the resilience and security of the network, as they help prevent attacks and maintain the integrity of the blockchain.
|
Fundamental Pillar |
Key Functions and Contributions |
| Network Operation | They support global operation, validating transactions and keeping the network state updated on all nodes. |
| Consensus Mechanism | They execute Proof of History (PoH), processing transactions in chronological order to achieve high performance and scalability. |
| Security and Resilience | They prevent attacks and maintain the integrity of the chain, acting as a barrier against technical failures or manipulation attempts. |
| Decentralization | They operate independently, eliminating single points of control or failure within the ecosystem. |
| Efficiency | They guarantee the speed and massive data processing that characterizes Solana’s infrastructure. |
What is Proof of History (PoH) and Why is it Mentioned So Much
In most blockchains, figuring out the exact order of transactions can be complicated. This is because there is no shared clock that tells all the computers (nodes) on the network when something happens. Solana solves this difficulty with a unique system called Proof of History (PoH), which acts as a built-in clock for the blockchain.
Indeed, Proof of History creates a timeline of events through a process called hashing. Hashing takes data and runs it through a special formula, producing a unique string of letters and numbers.
Advantages of Proof of History
- Improved efficiency:validators can process transactions faster without having to wait for consensus on the time and order of transactions.
- Enhanced security: the immutable sequence of hashes makes it difficult for cybercriminals to alter the order of transactions.
- Scalability: PoH allows the network to handle a much larger volume of transactions by streamlining the validation process.
Disadvantages of Proof of History
- High hardware requirements:validators must constantly run VDF and hashing, requiring powerful hardware. This limits access to validation.
- Risk of centralization: due to the complexity and lower number of validators, validation may be less decentralized compared to simpler models like PoW, which runs on generic hardware.
- Novelty and limited testing: PoH is relatively new; experience under high network load is still limited. This has caused Solana to suffer multiple network outages in the past.
In summary, Proof of History is like a built-in clock for the Solana blockchain. It is not a consensus mechanism, but a way to shorten the time it takes to confirm the order of transactions. When combined with PoS, selecting the next validator for a block becomes safer and easier.
What is Needed to “Mine” Solana as a Validator?
To become a validator on the Solana network, you need the appropriate hardware and software setup, plus the commitment to maintain a secure node. All of this is necessary to keep up with one of the world’s fastest blockchains:
- A significant amount of staked SOL: It is necessary to own or receive delegations of a considerable amount of SOL tokens. This locked asset acts as a trust guaranteeand is what allows the validator to have a voice in the consensus. Furthermore, the stake must be sufficient to cover the daily operational costs of sending votes to the network.
- Powerful hardware and stable connection:Due to Solana’s high speed, high-performance hardware with great parallel processing capacity and fast-access memory is required. Likewise, a symmetrical and ultra-stable internet connection is essential, as any loss of synchronization penalizes the node’s efficiency.
- Technical knowledge: Operating a node is not an automated task; it requires advanced systems knowledge for installation, constant performance monitoring, and immediate response to critical software updates. The health of the network depends on the operator knowing how to keep their node optimized and secure at all times.
Risks and Responsibilities of Being a Validator
Being a validator on Solana is a high-responsibility activity that balances supporting the ecosystem with a direct financial incentive. The key to success lies in technical stability to avoid the risks of falling out of consensus.
|
Dimension |
Function or Challenge |
Description and Consequences |
| Security | Data Integrity | They verify the accuracy of transactions, preventing fraud and errors in the chain. |
| Speed | Use of PoH | They process thousands of operations per second chronologically, achieving low latency. |
| Power | Governance and Consensus | They use staked SOL to vote on the network’s state and decide on future updates. |
| Technical Challenge | Hardware and Connectivity | They demand high-performance equipment and protocols to handle demand spikes. |
| Economic Challenge | Investment and Rewards | Locking of capital in exchange for transaction fees and issuance rewards (staking). |
| Risks and Responsibility | Loss of Rewards | A poorly managed node that falls out of consensus immediately stops receiving income. |
| Risks and Responsibility | Penalties (Slashing) | Incorrect behavior or serious failures can result in the partial loss of staked capital. |
Simple Alternative: Delegate Your SOL to a Validator
A feasible option for native participation on the blockchain is to delegate your SOL to a validator. With this method, you transfer your stake and your voting rights to an established validator on the network.
In this way, you indicate to the network that you trust the validator: basically, you vote for that participant to create the next block. The more votes a validator has, the more likely they are to be selected to validate the next block. Thus, for supporting the validator that creates a block, you receive a portion of the rewards.
Delegation is a great way to earn rewards for staking without needing to operate complex hardware on your own. However, delegating to validators involves a shared risk-reward structure. This means that if the validator does not adhere to the network’s rules, you risk having a penalty applied to your stake.
Points to Review Before Delegating
Before choosing who to trust with your funds, it is vital to evaluate the following criteria to maximize your earnings and protect your investment:
- Reputation and track record:Research the validator’s identity and their presence in the community. Validators with an established and transparent brand are usually more reliable.
- Validator commission: Check what percentage of the rewards the validator keeps for their service.
- Uptime History: A validator that is frequently disconnected does not generate rewards. Choose nodes with a history of availability close to 100%.
- Your wallet security: Security starts with you. Make sure to delegate from a self-custody wallet (where you own the private keys) and keep your seed phrases protected offline.
How to “Mine” Solana in Practice?
|
Category |
Key Concept |
Details and Differentiation |
| Difference from Bitcoin | It is not “mined” | Unlike Bitcoin (PoW), Solana does not use competitive hardware mining. It is based on Proof of Stake (PoS) and Proof of History (PoH). |
| Route 1: Validator | Set up a node | This is the most complex option. It requires industrial hardware, a stable connection, and deep technical knowledge to process transactions. |
| Route 2: Delegate | Delegate your SOL | This is the simplest option. You transfer your voting rights to a validator from your self-custody wallet to receive passive rewards. |
| Responsibility | Risk Management | A poorly managed validator loses rewards by falling out of consensus and may suffer penalties (slashing) of capital. |
| Selection Criteria | Points to Review | Before delegating, evaluate the validator’s reputation, uptime history, and the commissions they charge. |
In closing, it should be clear to us that it is not possible to mine Solana in the same way as Bitcoin. Being a network based on Proof of Stake and Proof of History, Solana does not require machines to compete by solving mathematical calculations to “extract” new coins.
Instead, the system relies on validation and staking, where security is guaranteed through the commitment of assets and not by electrical power. Therefore, if you seek to earn rewards on this network, the path is not traditional mining, but choosing between the technical infrastructure of a validator or the simplicity of delegation.
