What is Solana, and how does it try to be so fast?
Solana was designed for speed, using a built-in clock to order transactions. This profile explains how that works, how new SOL is issued and what happened when the network stopped.
Education only, not investment, tax or legal advice. Crypto-assets are high-risk — risk disclosure.
SOLThe short answer
Solana is a public blockchain built for fast, cheap transactions, and SOL is its native token. Validators who stake SOL take turns producing blocks, while a cryptographic clock called proof of history orders events. New SOL is issued through a declining inflation schedule rather than a fixed cap.
Key takeaways
- Solana was proposed in a whitepaper by Anatoly Yakovenko, and its main network (Mainnet Beta) launched in March 2020.
- Proof of history acts as a shared clock, used alongside proof of stake to decide which validator produces each block.
- SOL's documented inflation schedule starts at 8% a year and falls by 15% a year towards 1.5%, and is marked as subject to change.
- Half of each base transaction fee is burned and half goes to the validator.
- The network has stopped producing or finalising blocks more than once, including a 17-hour outage in 2021.
What is Solana and who created it?
Solana is a public blockchain: a shared ledger that anyone can use and that runs programs as well as payments. Its native token is SOL. Fees and balances are counted in lamports; one lamport is 0.000000001 SOL2.
The design comes from a whitepaper by Anatoly Yakovenko titled Solana: A new architecture for a high performance blockchain1. Its central idea is proof of history, a way to record the passage of time inside the ledger itself1. Yakovenko went on to lead Solana Labs, described in 2021 as its co-founder and CEO6. The main network, called Mainnet Beta, launched in March 20206. The software validators run now comes from more than one team. Anza, founded in 2024 by executives and core engineers from Solana Labs, builds Agave, a fork of the Solana Labs validator client14, while Firedancer is a separate validator client written from the ground up15.
Like Ethereum, Solana hosts smart contracts, programs that run automatically on the network. Its pitch is speed and low fees. The trade-offs behind that pitch are what the rest of this profile is about.
How does Solana decide who adds the next block?
Solana uses proof of stake. Validators, the computers that produce new blocks, put up SOL as stake, which can be forfeited if they are proven to have acted maliciously2. At any moment one validator is the leader: the one allowed to add entries to the ledger2.
How block production is organised
- 1
A schedule is set
For each epoch, a set number of slots, a leader schedule says which validator leads when2.
- 2
The leader takes its slot
During its slot, the leader takes in transactions and produces a block2.
- 3
Proof of history stamps the order
A chain of hashes proves that each piece of data existed before the next proof and that a set amount of time passed in between2.
- 4
Stake keeps validators honest
A validator caught acting maliciously can lose its stake2.
Slots are short. They were originally set at 400 milliseconds; two staged cuts in August 2026 brought the main network to 300 milliseconds, with further cuts to 200 milliseconds tested but not yet scheduled for it13. Each leader keeps four slots in a row, and an epoch is fixed at 432,000 slots, about 36 hours at today's slot time13.
Proof of history is not a consensus method on its own. The whitepaper describes it as a tool that works alongside one, such as proof of stake, to cut down the messages validators must exchange, with the stated aim of finality in under a second1. Think of it as a shared clock: if everyone can verify the order of events, less time is spent agreeing on it. Our proof of work vs proof of stake explainer covers the wider choice.
How is new SOL created, and is there a maximum supply?
New SOL comes from inflation paid to validators and stakers in proportion to their stake4. The validator documentation gives an example schedule: an initial inflation rate of 8% a year, reduced by 15% each year, until it settles at a long-term rate of 1.5%4. Because the long-term rate stays above zero, the schedule does not end at a fixed maximum supply. The documentation flags these figures as subject to change4.
How the documented example schedule declines (illustrative, by year of inflation rather than calendar year)
| Year of schedule | Annual inflation rate |
|---|---|
| 1 | 8.00% |
| 2 | 6.80% |
| 3 | 5.78% |
| 5 | 4.18% |
| 8 | 2.56% |
| 10 | 1.85% |
| 11 | 1.57% |
| 12 onward | 1.50% (long-term floor) |
The rules can change through governance. In 2026, two proposals to double the yearly reduction from 15% to 30%, SIMD-0411 and SIMD-0550, were still under discussion on Solana's governance forum105.
Fees push the other way. Every transaction pays a base fee of 5,000 lamports per signature, half of which is burned and half paid to the validator; any extra priority fee goes entirely to the validator3.
What is SOL used for?
SOL pays for transactions and secures the network through staking34. Many tokens, including stablecoins such as USDC and USDT, also run on Solana1112 and need SOL for fees.
Worked example
What the base fee works out to
Has the Solana network ever gone down?
Yes. On 14 September 2021, Solana was offline for 17 hours after bots flooded the network with transactions during a token launch, overloading validators7. Engineers wrote a fix and more than 1,000 validators coordinated an upgrade and restart7.
On 6 February 2024, block finalisation halted at 09:53 UTC and resumed about five hours later8. The cause was a bug that sent part of the software into an endless recompiling loop; validator operators again coordinated a restart on patched software8.
Figure · Solana: key dates
- Mar 2020Mainnet Beta
- Sep 202117-hour outage
- Jan 2024Agave client fork announced
- Feb 2024Five-hour finality halt
- Aug 2026300 ms slots
Solana milestones
| Date | Milestone |
|---|---|
| Mar 2020 | Mainnet Beta launches6 |
| 14 Sep 2021 | 17-hour outage after a transaction flood7 |
| 30 Jan 2024 | Anza announces the Agave client fork14 |
| 6 Feb 2024 | Block finalisation halts for about five hours8 |
| 2026 | Proposals to speed up the fall in inflation under discussion5 |
| Aug 2026 | Slot time cut from 400 to 300 milliseconds13 |
While a chain is halted, new transactions cannot be confirmed, so holders cannot move funds on-chain until it restarts.
What are the specific risks of holding SOL?
- Outages. The network has halted more than once78. During a halt you cannot send, sell or move SOL on-chain.
- Price swings. In a 2023 investor alert, the SEC warned that crypto asset investments can be exceptionally volatile and speculative9.
- Changing monetary rules. The inflation schedule is marked as subject to change4, and proposals to alter it have been debated5.
- Dilution if you do not stake. New SOL goes to stakers4, so holders who do not stake own a shrinking share of the total supply.
- Validator risk. Stake can be forfeited if a validator is proven to have acted maliciously2.
Risk warning
Fast is not the same as safe
Low fees and quick confirmations do not protect you from price falls, outages, scams or lost keys. Nothing here is investment advice; read our risk disclosure and our guide to wallets and keys.
What mistakes do beginners make with Solana?
Common beginner mistakes
Assuming SOL has a fixed supply
It does not. The documented schedule keeps issuing new SOL at a long-term rate.
Keeping no SOL for fees
Moving tokens on Solana, including stablecoins, needs a small amount of SOL.
Mixing up networks
A USDC or USDT on Solana is not the same as one on Ethereum. Check that the receiver supports Solana before sending.
Expecting the network never to pause
Solana has halted before. Avoid plans that depend on moving funds at one exact moment.
Frequently asked questions
What is a lamport?
The smallest unit of SOL. One lamport is worth 0.000000001 SOL2, so one SOL equals one billion lamports.
Who runs the Solana network?
Why is it called Mainnet Beta?
It is the name the main network launched under in March 20206. Despite the word "beta", it is the live network whose outages are described above.
Can I earn rewards by staking SOL?
Yes. Inflation rewards are shared in proportion to stake4. Rewards are not guaranteed and are paid in SOL, whose value can fall.
The bottom line
Solana pairs proof of stake with proof of history to process transactions quickly and cheaply. SOL pays the fees and secures the network, and new SOL is issued on a declining inflation schedule that has no fixed cap and may change. The network has stopped more than once, so weigh speed against reliability before relying on it.
Sources
- Solana: A new architecture for a high performance blockchain (v0.8.13) — Anatoly Yakovenko (solana.com) Primary source
- Terminology — Solana developer docs (solana.com) Primary source
- Fees — Solana developer docs (solana.com) Primary source
- Inflation Schedule — Agave validator documentation (Anza) Primary source
- SIMD-0550: Proposal to Double Disinflation — Solana Developer Forums (governance), 2026
- Solana Labs Completes a $314.15M Private Token Sale Led by Andreessen Horowitz and Polychain Capital — solana.com news, 2021 Primary source
- 9-14 Network Outage Initial Overview — solana.com news, 2021 Primary source
- 02-06-24 Solana Mainnet Beta Outage Report — solana.com news, 2024 Primary source
- Exercise Caution with Crypto Asset Securities: Investor Alert — Investor.gov, U.S. Securities and Exchange Commission, 2023 Primary source
- SIMD-0411: Proposal for Doubling the Disinflation Rate — Solana Developer Forums (governance), 2026
- USDC — Circle (circle.com) Primary source
- Supported Protocols — Tether (tether.to) Primary source
- Reduced Slot Times (SIMD-0525) — Solana Foundation (solana.com), 2026 Primary source
- Meet Anza, a New Solana-Focused Dev Shop — Anza, 2024 Primary source
- Firedancer documentation — Firedancer project, 2026 Primary source
How we checked this page: every figure above links to the numbered source it came from. Spotted an error? Tell the desk — see our editorial policy.
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