Solana is a high-performance proof-of-stake blockchain that has gained popularity for its speed and low transaction costs. It can process up to 50,000 transactions per second, significantly faster than major competitors like Ethereum. Solana utilizes a unique proof-of-history consensus mechanism that helps it achieve fast finality times.
The native cryptocurrency of the Solana network is SOL. There is currently over $30 billion worth of SOL staked on the network. Solana also supports smart contracts and has an ecosystem of decentralized applications across DeFi, NFTs, Web3 and more.
Solana’s latest v1.16 network upgrade introduces several key features and enhancements:
- Confidential Transfers — This allows encrypted transactions for SPL tokens to improve user privacy through zero-knowledge proofs. Balances and amounts are hidden.
- Faster zero-knowledge proofs — New BN-128 curve support makes generating and verifying proofs more efficient. This enhances privacy features.
- Validator improvements — Reduced RAM usage, upgraded gossip protocol, and faster recovery for validators. This improves network performance.
- Resizable accounts — Developers can now deploy with smaller accounts and expand storage as needed. This adds flexibility.
- Epoch accounts hash — A new hash produced each epoch enhances network integrity monitoring capabilities.
Overall, v1.16 focuses on privacy, performance, flexibility and validator improvements to make Solana more robust and usable.
Confidential Transfers, introduced in v1.16, are a new privacy feature for Solana’s SPL tokens. SPL tokens are similar to ERC-20 tokens on Ethereum.
Confidential Transfers utilize zero-knowledge proofs to hide certain transaction details like:
- Sender & receiver account balances
- Transfer amounts
- Token account balances
This improves privacy without full anonymity. Wallet addresses are still public on the blockchain for accountability, but users can now conceal sensitive transaction information.
The encryption behind Confidential Transfers uses Twisted ElGamal, an algorithm that allows mathematical operations on encrypted data. Zero-knowledge proofs via Sigma protocols then validate transactions trustlessly without revealing the encrypted data.
The Solana team plans to adopt a more frequent release cycle going forward, targeting upgrades every 3 months or so. The steady progress of network upgrades demonstrates the continued development momentum for Solana as it aims to become the premier platform for speed, scalability and usability.
