- High operational costs linked to Boneh-Lynn-Sacham aggregation, which validates signers in Ethereum but increases Solana’s expenses.
- Solana plans efficiency improvements in consensus mechanisms, potentially lowering costs as hardware technology advances.
Anatoly Yakovenko, recently highlighted that Solana has outpaced Ethereum, in a good metric—the economic barrier for honest nodes participating in consensus.
This metric measures the financial cost required for nodes to engage effectively in the blockchain’s consensus process, which is essential for validating transactions and ensuring network security.
Comparative Costs of Running Nodes
Yakovenko pointed out that it is currently ten times more expensive to operate an honest node on Solana compared to Ethereum. This disparity stems largely from the investments both platforms have made in their consensus mechanisms.
Economic barrier for honest nodes participate in consensus on solana is 10x higher than ethereum atm. Largely due to the investment ethereum has made into bls aggregation for consensus messages.
Maybe that’s something that solana will implement eventually, maybe it will be…
— toly 🇺🇸| bip-420 (@aeyakovenko) June 10, 2024
Specifically, Solana’s higher costs are linked to the Boneh-Lynn-Sacham (BLS) aggregation that Ethereum employs for consensus messages. The BLS is a cryptographic signature scheme that helps verify the authenticity of a signer independently by node validators.
Financial Support and Future Plans
The cost of running a Solana validator has been revealed to exceed $65,000 per year, a figure supported financially by the Solana Foundation to maintain network operations. In light of these high costs, Yakovenko disclosed plans to implement a more efficient consensus mechanism.
He suggested that as hardware technology advances, the expenses associated with sending validator messages across the network will decrease, which in turn will reduce the overall cost per vote. This development could potentially lower Solana’s economic barriers to node participation in the future.
Innovative Solutions for Cost Reduction
Further addressing the cost issue, Yakovenko mentioned the potential establishment of voting subcommittees within Solana’s consensus process. This strategy would involve rotating boxes in and out of the committee to lower vote fees and reduce the vote load, contributing to more affordable and efficient network operations.
The Solana Foundation provides financial support to many validators because running a Sol validator costs $65k+/year.
Now, the next step in their plan to solve MEV was to pull financial support from validators who extract MEV 😆
Solana is not a serious settlement layer https://t.co/MvD57rLBmV
— Ryan Berckmans ryanb.eth (@ryanberckmans) June 10, 2024
Market Impact on SOL and ETH Prices
Despite these technological advancements, both Solana and Ethereum have experienced a decline in market price recently. Solana has seen a substantial weekly decrease of 12.91%, bringing its price down to $150.5.
This downturn reflects broader market volatility and reduced investor demand for the cryptocurrency. Conversely, Ethereum has also faced a decline, with its price now at $3,485 after a 9.49% drop over the same period, despite the recent approval of Spot Ethereum ETFs by the SEC.
#Solana is set for a major 53% price move! Keep an eye on the $143 support and $178 resistance levels to gauge the direction of the $SOL trend. pic.twitter.com/SB9tJ6D02u
— Ali (@ali_charts) June 12, 2024
Crypto analyst Ali Martinez remains optimistic about Solana’s market future, predicting a potential price surge of up to 53%. This optimism highlights the potential for recovery and growth despite the current market challenges facing both cryptocurrencies.
