Robert Steinadler, 6 months ago
Solana is very successful not only in terms of price. Two years ago, the cryptocurrency was trading at around $0,50 and peaked with the rest of the market last year. Many analysts and experts had doubts about the technology because everything was still under development and basically one big beta test. It turned out that these doubts were partially justified since Solanas network went down on several occasions and had to be restarted.
Why is the pressure continuing on this very young cryptocurrency and why is Sam Bankman-Fried still bullish on Solana?
Last week the news was all over the crypto media. Somehow about 9.000 wallets got hacked and many suspected that Solana had a serious issue with its code. The good news is that the Solana blockchain itself was never at risk.
The wallet provider Slope had a serious security issue. The company was basically storing the mnemonic seeds of its customers in plain text. Many Slope users took their seeds and used them with different wallet software. That was the reason why all kinds of wallets seemed to be affected. Only hardware wallets provided safety even when used with Slope.
At the end of the day, it wasn’t Solana’s fault but most news outlets and thought leaders in the crypto space were quick to blame it on the repeatedly failing blockchain. But that wasn’t the only incident that caused bad press for Solana.
It was also last week when the world learned that Ian Macalinao faked the identity of 11 different developers in order to leave investors under the impression that a whole team was working on his DeFi application. But that wasn’t everything he faked.
He also drove a lot of fake liquidity to Sunny Aggregator which was built on top of Sabre, both being the creation of a single developer. Since the total value locked (TVL) was a metric that many investors were paying attention to, he simply decided to invent a scheme where every dollar of value was counted several times, thus boosting the TVL.
The hack, the fact that Solana is going offline from time to time and now the story of a fake DeFi ecosystem is taking its toll and is even more devasting for Solana’s reputation. But one man stays bullish.
The fact that billionaire and crypto legend Sam Bankman-Fried is bullish on Solana should be taken with a grain of salt. It is well known that SBF is invested in this technology and his company Alameda research is also invested in many projects that have been built on top of the Solana blockchain.
He pointed out that the recent hack was not the blame of Solana and that the developers of Solana Labs have to take the heat for something they are not responsible for. This claim isn’t even crazy but it remains to be seen if Solana Labs has really done its homework. Bankman-Fried estimates that two-thirds of the work needed is already done and that Solana is currently undervalued due to the turmoil in the last couple of days.
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