Solana has had a strange go of it. The network rose rapidly from “alt-L1” obscurity to become one of the highest-valued, most buzzed-about blockchains within months of its “mainnet-beta” public launch in 2021. And, for as long as the network has been live, it’s been dogged by accusations of being a centralized wolf in decentralized sheep’s clothing. But, what, exactly, have critics meant by that?
In our framework “The Layers of Decentralization,” we lay out the two key dimensions that define the decentralization of a Proof-of-Stake blockchain, like Solana:
In terms of capital, Solana has frequently been crticized as a “VC-chain,” one that distributed an outsized amount of the network’s native token, SOL, to Venture Capitalists and other investors. The most famous of these investors was the FTX-Alameda chimera, which bought a lot of cheap SOL early on, and touted the investment rather publicly. Critics argue that these kinds of high-profile investments artificially pumped the value of SOL through its previous highs.
Now, though, the fiat value of SOL has fallen, alongside the declining overall market and the ongoing implosion of FTX-Alameda, more than 90% from its peak. Obviously, you would not like to see the value of your decentralized system be so closely tied to the fortunes of so few participants.
But, despite the loss in paper value, there’s a more optimistic take on the FTX-Alameda fallout. As our founder, Chris Remus, wrote back in November:
In less than two weeks, two of Solana’s biggest centralization risks have been purged. — ©hris ℞emµs (@cjremus) November 12, 2022
Ethereum founder Vitalilk Buterin later shared a similar sentiment:
Some smart people tell me there is an earnest smart developer community in Solana, and now that the awful opportunistic money people have been washed out, the chain has a bright future.— vitalik.eth (@VitalikButerin) December 29, 2022
Hard for me to tell from outside, but I hope the community gets its fair chance to thrive🦾🦾
From the perspective of decentralizing capital, it feels pretty hopeful to see Solana lose some of its biggest whales.
In terms of infrastructure, Solana has been called a centralized database masquerading as a blockchain. One popular meme rebrands the network as “Sqlana,” in a nod to centralized SQL databases. But, assessing the decentralization of blockchain infrastructure is as much about narratives as it is about numbers. And, as we’ve tracked in our own reporting, Solana has quite a compelling narrative for decentralization in some areas, even measuring among the most decentralized blockchains.
One area wherein that narrative is less compelling, however, is governance. Many Proof-of-Stake protocols have adopted some version of a community governance process, wherein token-holders can propose, and vote on, initatives to steer the future of the network. Solana, meanwhile, has kept its future largely in the hands of its core protocol team, Solana Labs, and its primary community organization, the Solana Foundation. In response, some observers have called to mind the adage, “If you want to go fast, go alone. If you want to go far, go together.”
Solana has indeed gone fast, embracing a kind of Hot Rod spirit to push the technical envelope for L1 blockchains. And in a new piece detailing its outlook for 2023, the Solana Foundation highlights the following technical areas as top-level focuses for the coming year: Mobile, Reliability and Resiliency, Programmability, Performance, and Security.
Even though “governance” failed to make the list, there are signs that the Solana community is ready to embrace a more inclusive spirit in 2023.
The first sign comes from the development of the Solana protocol itself. Historically, few developers have been allowed to propose or implement changes to the software that runs the network. But now, we’re beginning to see new opportunities for more participants to contribute.
At November’s Breakpoint event, we saw the start of informal discussions around opening up governance on the protocol. And today, we’re beginning to see activity increase around the Solana Improvement Document (SIMD) process, currently the most formal avenue for Solana developers to propose and discuss (if not exactly vote on) changes to the protocol.
The second sign that Solana is ready to “go together” comes from the social initiatives that elevate the network beyond the protocol. Solana boosters have often touted a vibrant community of “builders” as one of the network’s competitive advantages over other L1s. Much of the most visible work to foster this community has come from the Solana Foundation directly, in the form of its global “Solana Hacker House” program. But now, we’re seeing that start to change, with independent community members developing their own social programming.
For example, this week, Chainflow is joining dozens of other teams from across the Solana ecosystem in hosting the Sandstorm Hackathon, a fully-remote, independent event to foster community-driven innovation on the network. Led by two Solana teams, LamportDAO and Helius Labs, Sandstorm is an ambitious effort to re-energize developers on the protocol after the dramatic end to 2022. The Solana Foundation has joined as a sponsor, but the event seems to be a refreshingly grassroots initiative.
We’ll share more about Sandstorm as the hackathon develops. In the meantime, check out our “Decentralized Infra” track, and consider joining to help decentralize Solana while competing for our prizes: $2,000 in USDC and six months of free enterprise-grade RPC access. You can learn more and sign up at the Sandstorm Discord. The event ends on January 23rd.
And then there’s BONK.
“Memecoins” are cryptocurrencies with no inherent utility beyond speculation. “Dog Coins” are a subcategory of memecoins that are, well, named after dogs. With that in mind: “Bonk Inu” (identified by the ticker “BONK”) is a new Dog Coin on Solana that has, in recent weeks, drawn a lot of attention from the network. (Some people have been calling it “Solana’s first Dog Coin,” but that feels like Samoyedcoin erasure.)
The Decentralized Exchange (DEX) Orca, for example, has seen quite a bit of recent action from BONK. And while it’s not unheard-of for a memecoin to catch fire for a time, it feels unsual for one to espouse a kind of righteous, populist indignation:
So @aeyakovenko @rajgokal @Austin_Federa to be clear this is a social coup. You only have two options— LtLollipop (FRAKT,HADES,BONK,SMB) (@LtLollipop9) January 2, 2023
1. Try to end it and destroy the biggest advantage @solana has the community
2. Embrace it.
Either way the community will be building Web3 not your investors. They can fuck off.
What does BONK mean in the face of Solana’s movement toward a more inclusive and democratic future? Who knows. Some signs suggest that the winds may already be changing for the token.
Regardless of what happens with BONK, or any single project on Solana, it’s clear that a shift is taking place on the network, toward a more community-led spiri . As Solana supporters since before the network’s public launch, we’re excited to do our part to center decentralization in these important next steps.
Let's build a brighter future together.