Buterin thinks Solana can overcome its current situation and retain its underlying value.
The FTX issue was front and center last month, with the company’s bankruptcy filing having a big negative impact on the Solana ecosystem. Since that time, a number of projects have abandoned the network, and the native token has lost a sizable portion of its USD value.
It’s interesting that Vitalik Buterin, a co-founder of Ethereum, has endorsed the blockchain, once dubbed a “Ethereum Killer.”
On December 29, Buterin wrote on Twitter that recent developments in the cryptocurrency business had removed corrupt individuals from the ecosystem, increasing the likelihood that Solana will prosper in the future.
Solana Blockchain is Affected by FTX Bankruptcy
Due to its close ties to the exchange and its sibling trading company Alameda Research, Solana, which bills itself as the most scalable protocol in the business, was among the numerous companies with considerable exposure to FTX.
Before the abrupt collapse, Sam Bankman-Fried (SBF), the creator of FTX, and Alameda Research—then led by Caroline Allison—held SOL, the network’s native token, among other altcoins.
Alameda controlled almost $1.2 billion in SOL, according to a leaked financial report filed with the United States Securities and Exchange Commission (SEC).
Following the November 11 announcement of the FTX bankruptcy, the value of the cryptocurrency immediately dropped. In the same month, SOL dropped from $22 to $14 before tumbling as low as $8 yesterday. According to CoinMarketCap, the token is now ranked as the 17th largest cryptocurrency asset with a market valuation of $3.5 billion.
Buterin Thinks the Solana Protocol Still Has Value on Its Own
Buterin thinks the Solana protocol still has fundamental value and can bounce back from its current state despite the difficulties in the ecosystem.
The co-founder of Ethereum admitted that while it is challenging for him to evaluate the platform from the outside, he thinks Solana has a solid staff supporting the project.
SOL to Retaliate?
Like Buterin, Raj Gokal, the co-founder and COO of Solana, predicted in a previous tweet that the protocol’s test-of-time will pass. The most recent difficulties with the project, he observed, are just as difficult as the earlier ones. But Solana now has a sizable and committed team to deal with the current situation.
While the team’s plans for reviving the project are yet unknown, a Twitter user said that it would be similar to Ethereum’s resurrection in 2018.
Anatoly Yakovenko, the CEO of Solana Labs, stated last month that the project had learned its lesson the hard way during the 2018 bad market and now has reserves to cover its increased burn rate for about 30 months.
Vitalik Buterin: The Solana Chain Has a Bright Future
Recently, Vitalik Buterin, a co-founder of Ethereum, commented about the state of the Solana blockchain ecosystem. Buterin claims that he has learned that Solana has a robust and committed developer community. The future of this community, he added, may be dubious given the recent departure of “opportunistic money” searchers. Buterin said that the Solana blockchain has a promising future despite this.
Buterin, despite not being a part of the Solana community, expressed optimism that the group will be given a fair chance to prosper.
Numerous members of the cryptocurrency world have viewed Buterin’s contributions to the Solana ecosystem as encouraging signs. His support might open the door to the blockchain and the revival of the once-vibrant Solana community.