- Visa expands its stablecoin pilot by incorporating Solana, emphasizing the blockchain’s high throughput and efficient transaction costs.
- Solana’s unique transaction processing abilities and broad network availability underscore its potential as a game-changer in the financial sector.
A New Era in Transaction Efficiency
Visa, in its continuous endeavor to revolutionize cross-border transfers, has chosen to embrace Solana, spotlighting the blockchain’s standout features and its fit within the global payment landscape.
The Power of Parallel Processing
Solana’s capacity to handle multiple transactions simultaneously is a defining trait. Unlike blockchains such as Ethereum that process transactions one after the other, Solana’s parallel transaction processing permits concurrent transactions, as long as they involve distinct accounts. This essentially means that while Ethereum processes an average of 12 transactions per second, Solana can handle 400 and, in heightened demand, can even touch 2,000.
Parallel processing not only boosts transaction speeds but also enhances network efficiency. As explained by the authors,
“Transactions impacting separate accounts can be executed simultaneously, enabling Solana to efficiently support payment and settlement scenarios.”
This technique alleviates potential network congestion, ensuring that a slowdown in one sector doesn’t disrupt the overall transaction flow.
Cost-Effective and Predictable Fees
Another of Solana’s standout features is its cost structure. With transaction fees often less than $0.001, Solana offers a predictable and budget-friendly option for businesses, contrasting with the variable fees seen in Ethereum and Bitcoin, contingent on network load. If, for instance, a particular asset, say an NFT, witnesses a spike in demand, only the fees associated with that specific account will increase. This system of localized fees correlates directly with Solana’s parallel processing strength.
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Impressive Speed and Network Availability
Transaction finality, an indicator of how swiftly actions are authenticated on a blockchain, is another domain where Solana shines. With a target slot time of just 400 milliseconds, its efficiency eclipses many counterparts. An “optimistic confirmation” mechanism further accelerates transaction validations.
As of July 2023, Solana’s robust network features 1,893 active validators and an added 925 RPC nodes, distributed across over 40 countries, ensuring its robustness and dependability. The vastness and diversity of this network make it resilient against unforeseen events or sudden policy shifts by providers.
In a bid to solidify this network stability, Solana has welcomed various validator clients like Jito-Solana and Firedancer. This multiplicity ensures that while one client may face vulnerabilities, others remain untouched, shielding the network from potential disturbances due to singular software issues.
Visa’s previous experiments with Ethereum in 2021 set the stage for this latest partnership with Solana. By incorporating global blockchain networks and stablecoins like USDC, Visa’s primary goal remains clear: streamlining and expediting cross-border settlements.
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