Holders of the Solana token have a bearish bias towards it following a slow-down in the performance of the Solana blockchain. Hence, it is no wonder that one of Ethereum’s founders is predicting a market crash for the Ethereum competitor.
Gavin Wood Warns Solana Investors
One of Ethereum’s founders, Gavin Wood, warns Solana holders of a drop in Sol’s price. Wood shared his view about a possible Solana crash following a decline of $1 trillion in the overall evaluation of the crypto market. According to Wood, the decline in the crypto market cap will likely hurt altcoins such as SOL, ADA, XRP, and BNB.
Wood made his opinions known during an interview with Reuters at the Davos World Economic Forum. “Whenever people invest in a community, economy or ecosystem, they must pay close attention to the foundation principles of the community’s native token.”
He added that “even if people make mistakes, the technology would have presented sufficient facts about what they are buying.” Investors in the crypto market have become more cautious following the crash of the terra network native token and stablecoin.
Also, holders’ sentiment is still fear, as shown by the crypto fear and greed index. The fear and greed index is in the extreme fear region at 13 points. According to Wood, the huge volatility in the crypto market would cause a wide swing in Solana’s price.
Solana’s Block Time Issues
Per an announcement from the Solana team on May 28 at 03:34 UTC, the network’s clock is 30 minutes behind schedule. These slow block times usually hurt staking rewards.
A part of the official statement reads, “the longer-than-normal block time is causing a 30 minutes delay in on-chain timekeeping. Hence, the time shown by DApps and block explorers is different from the actual wall-clock time.”
The Solana block time is currently 659 milliseconds compared to the 400 milliseconds by design. The slow block time creates clock differences and lowers staking rewards.
The normal annual staking reward is 183 epochs. However, the slow block time has caused a decrease in this epoch rate. A staking reward of 5.08% means that sol is the second-most staked digital asset. Eth is the most staked digital asset.
Stakingrewards data show that sol’s staking ratio is more than 72%. Hence, it is the digital asset with the highest staking ratio within the top 10 cryptos.
The Solana Blockchain And Its Many Technical Issues
The Solana network has experienced several outages since January 2022. Hence, it isn’t surprising that investors are angry with the network’s team. Two of the most notable outages on the Solana network this year are the ones in January and the beginning of this month.
In those months, the network was down for more than 17 hours. An analysis of the incident states that NFT mining bots were the cause of the outage that happened earlier this month.
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