Blockchain technology is evolving rapidly. As such, entrepreneurs are exploring ways to implement such technology in other industries as well. There are hundreds of industries that can benefit from blockchain’s safety and effectiveness. One of the recent industries where blockchain is being used is the energy industry. The Solar Blockchain Foundation has built a bridge between renewable energy and blockchain technology. This project merges the power of solar energy with the potential of a decentralized network to create a sustainable, efficient, and fully decentralized platform.
The Solar Foundation doesn’t use the traditional Proof-of-Work (PoW) consensus mechanism because of its energy consumption and vulnerability. Instead, Solar’s blockchain, the Solar Blockchain, uses a Delegated Proof of Stake (DPoS) consensus mechanism powered by the Solar Core. Throughout this article, we will review the Solar Blockchain, its innovative features, and the role of its native token, SXP. As we dive deeper, we will briefly touch upon the overall Solar ecosystem as well.
What is the Solar Blockchain?
The Solar blockchain is a Layer 1 blockchain framework. Being a Layer-1 blockchain means that Solar does not operate on top of another network but it’s own. As mentioned above, the Solar blockchain is secured by a consensus mechanism known as the Delegated Proof-of-Stake (DPoS). Unlike a Proof-of-Work mechanism, the DPoS is considered safer, and most importantly, more energy efficient.
The goal and vision of the Solar blockchain are to outperform traditional blockchains that use PoW and simple PoS consensus mechanisms. Through the DPoS, Solar aims to build a decentralized, safe, and fast blockchain. As for its history, the Solar Network first made its debut back in 2018. The founders of Solar Network, Lizarondo and Willems, built the Solar ecosystem with the vision to provide sustainable green energy to developing areas through utilizing blockchain technology.
Before Solar Network, these two had launched Swipechain. In 2021, Binance acquired most of Swipe (SXP) shares. After the acquisition, the founders created the Solar Blockchain Foundation in late 2021. Today, the main focus of the team is to build an open-source ecosystem where developers and the community contribute the most. They have a vision where the ecosystem works in a totally decentralized manner. Some of the features of the blockchain are its smart contracts and decentralized storage. Other than that, the Solar Core provides numerous tools and resources for both its users and developers who want to contribute to the ecosystem.
Delegated Proof of Stake (DPoS)
The Delegated Proof-of-Stake (DPoS) consensus mechanism is crucial for the future of the Solar blockchain. This innovative approach toward securing the network keeps the ecosystem sustainable and decentralized. At the time of writing, the Solar blockchain has 53 block producers (node operators). Every node operator is chosen through a voting system by the network’s voters. These operators contribute to the network by further decentralizing the network, keeping it secure, and providing other types of contributions.
Each voter must download the Solar wallet to be able to participate in voting for a block producer. Through the Solar wallet, voters can vote for one or more node operators that they believe should partake in securing the network. Every operator receives commissions as they are incentivized to fully contribute to the network. These commissions come from the blocks produced on the Solar blockchain. It is common that the block producer shares the block rewards with its voters.
SXP: The Native Token Powering the Solar Blockchain
The Solar blockchain and its whole ecosystem revolve around its native token, SXP. This token plays a crucial role in driving and supporting the ecosystem. Moreover, SXP is utilized for a variety of purposes within the blockchain. Some of the features of the SXP token are:
- Voting: Every SXP token holder is eligible to participate in the voting process when it comes to selecting node operators. This way, SXP holders contribute to keeping the governance of the Solar blockchain decentralized.
- Staking: Every SXP token holder can stake their SXP tokens to improve the network’s security. The holders who stake their SXP receive rewards in return. These rewards are used as incentives by the blockchain so more and more people stake the token.
- Incentivizing Block Producers: Similar to how proof-of-work miners earn rewards as they operate, block producers do so as well. For every block created on the Solar blockchain, the node operators gain rewards in SXP. These rewards are often shared with the voters. This is a technique to keep the voters for whenever the next node operator elections happen.
- Ecosystem Development: The Solar Foundation operates smoothly because of the SXP token. This token is what drives the driving power of the whole blockchain. Additionally, users can use SXP tokens to fund initiatives and projects as well. This creates a healthy relationship between SXP and the ecosystem. Open-source development, community engagement, and collaboration with strategic partners are all ways how SXP contributes to the development of the ecosystem.
At the time of writing, there are over 17,000 SXP active wallets and more than 39 million SXP has been produced since its debut. Through the SXP burn mechanism, over 51,900 SXP has been burned to this date.
Does SXP Have a Future?
The Solar blockchain has a clear vision and plans ahead. While Solar is a new project, the team behind it has been in the cryptocurrency industry for many years now. Moreover, the previous project of the founders of Solar was a major one even before the acquisition of Binance. While the whitepaper and the roadmap are currently not available on the Solar website, they will be so soon. Until today, the Solar Foundation managed to get SXP listed in several major exchanges. Additionally, there has been steady progress in ecosystem development.
So, SXP has a future. From what we can tell, Solar (SXP) has a future “as bright as the sun.” Solar’s market capitalization is just $415 million at the time of writing. Until the next bull run, the inflow that the cryptocurrency market is expected to experience is huge. This might likely affect SXP as well, potentially driving its price upwards. Ever since Binance allowed the swap of the old SXP tokens to the new SXP tokens on March 28, 2023, the token has been surging in price. At the time of writing, most major cryptocurrency exchanges, including Binance, Huobi, and KuCoin support SXP. Additionally, other smaller exchanges such as WazirX, LBank, Phemex, Bitget, and Gate.io also support the trade of Solar (SXP).
Takeaways
- Solar was first founded with the goal of providing sustainable energy solutions to remote areas while using blockchain.
- Solar was founded back in 2019 but the Solar Blockchain Foundation was founded two years later, in December 2021, in Estonia.
- The founders of Solar, Joselito Lizarondo and Nayiem Willems, were the creators of Swipechain as well – a project Binance later acquired.
- Today, the Solar blockchain functions as a Layer 1 blockchain through something known as the Solar Core.
- In essence, Solar is an enterprise-level blockchain ecosystem. The ecosystem is powered mostly by the community in an attempt to stay decentralized.
- Solar (SXP) is the native token of the ecosystem. The Solar blockchain utilizes this token for everything, including governance.
- All in all, we see Solar (SXP) and its ecosystem as very promising, especially in the long run.
