Solana can’t be ‘global backbone’ of blockchain, Ethereum community member says

Ryan Berckmans, a member of the Ethereum community, argues that Solana cannot serve as the backbone of a “new global financial system.” He points out that Solana initially marketed itself as a monolithic blockchain capable of handling global transactions on a single chain. However, over time, Solana has shifted its approach, acknowledging the importance of Layer 2 (L2) solutions.

This shift became clearer when Solana rebranded its L2 solutions as “Network Extensions” instead of explicitly calling them L2s. According to Berckmans, this change in strategy followed the realization that successful blockchain applications, including those on Ethereum, were moving towards custom L2 appchains to scale effectively.

The pivot became even more evident when a major Solana development team decided to build a Solana Virtual Machine (SVM) L2 on Ethereum, signaling a clear shift towards embracing Ethereum’s proven L2 backbone strategy. This move suggests that Solana recognizes the limitations of its initial design and is increasingly looking to Ethereum’s L2 framework for scalability and broader adoption.

Several barriers in front of Solana

Ryan Berckmans, a former senior engineer on the Augur Project, outlines several issues preventing Solana from becoming the backbone of a global financial system:

Limited Client Diversity: Solana has only one production client (Agave Rust), whereas a global system needs at least three independent clients. Its second client, Firedancer, faces significant delays.

High Bandwidth Requirements: Solana’s 10Gbps upload speed creates centralization risks, limiting its ability to operate globally, especially in regions with weaker infrastructure.

Outages and Lack of Fallbacks: Solana has a history of network outages and lacks the ability to continue producing blocks during finalization issues, unlike Ethereum.

Economic Centralization: Solana’s ICO allocated 98% of tokens to insiders, raising concerns about decentralization compared to Ethereum’s 80% public sale.

Conflicts with L2 Solutions: Solana’s focus on Layer 1 (L1) execution scaling conflicts with the growing shift towards Ethereum’s Layer 2 (L2) solutions.

Berckmans predicts that Solana’s market share will continue to decline as Ethereum’s L1 and L2 ecosystem gains traction, with major companies like Coinbase, Kraken, and Visa adopting Ethereum’s L2 solutions. Despite Solana’s growth in certain areas, its fundamental limitations prevent it from being a global financial backbone.