Franklin: Solana’s Potential for Continued Growth, Firedancer to be Key Catalyst in Solving Congestion Issues

Franklin: Solana's Potential for Continued Growth, Firedancer to be Key Catalyst in Solving Congestion Issues

Franklin: Solana's Potential for Continued Growth, Firedancer to be Key Catalyst in Solving Congestion Issues

Traditional financial institution Franklin Templeton believes that Layer 1 blockchain Solana may continue to grow as it is well-prepared to capture the next wave of cryptocurrency adoption, solidifying its position as the third largest crypto asset after Bitcoin (BTC) and Ethereum (ETH).

In its May report, Franklin noted that Solana has demonstrated its resilience and dominance in the current bull market after suffering severe impact from the collapse of FTX exchange at the end of 2022. The company mentioned that significant token airdrops, including Jito and Pyth, have generated over $1 billion in wealth effect within the Solana ecosystem, driving up SOL and other Solana ecosystem tokens, especially memecoins.

Franklin expects more anticipated airdrops in the coming months, which will continue to bring wealth effect to the ecosystem. Additionally, the total fees and decentralized exchange trading volume on the Solana network have shown significant growth in the past year. The company anticipates that this growth will continue as the Solana network effect strengthens and network performance further improves. The report states:

Franklin also believes that the next major breakthrough in the crypto space is likely to occur on Solana. The company mentioned four areas that could bring the next wave of adoption, including DePIN (decentralized physical infrastructure network), payments (especially micro-payments), compressed NFT/xNFTs, and Central Limit Order Book (CLOB)/Payment for Order Flow (PFOF). Solana’s technology gives it a unique advantage in these areas.

Addressing network issues on Solana: a crucial catalyst
Franklin also mentioned in the report that the high activity has led to network congestion on Solana. The Solana developer community is continuously working to solve these issues, improve the network, and build for future higher demand, with Firedancer being “an important catalyst to address these network issues.”

Firedancer is a Solana validator client developed by Jump Crypto, aiming to optimize every component of the network. It is expected to go live later this year. Franklin wrote: