Solana (SOL) price has increased by more than 9% in the past 24 hours, surpassing the $140 mark as the overall sentiment in the crypto space improves.
However, there are some concerns today about the economic foundation of SOL.
Source: TradingView
Some critics have compared Solana to Terra Luna, the blockchain project that collapsed in 2022.
However, these comparisons have been dismissed by Cyber Capital founder and chief information officer Justin Bons as exaggerated and baseless fabrications.
In response to the growing rumors and concerns, Bons stated:
“Solana has a great economic design. With a long-term inflation rate of 1.5% combined with a 50% base fee burn rate. Low inflation ensures long-term sustainability while burn creates scarcity. The panic surrounding SOL ’s economy is just FUD!”
Bons explained that SOL 's economic design follows the same principles as major blockchains like Bitcoin (BTC) and Ethereum (ETH).
He pointed out that, in the early stages of many blockchains, including SOL, there is a period of high inflation that gradually decreases over time, a common and intentional strategy for many cryptocurrencies.
Bons emphasized that Solana 's economic model mirrors that of Ethereum after the EIP-1559 upgrade, which introduced inflation control mechanisms by burning transaction fees.
Bons believes that Solana 's Token Economy is sound and cannot be compared to Terra Luna's collapse.
“The only big difference is that SOL is scalable, while ETH is not. In the long run, a chain that can scale with low fees will be able to collect more fee revenue.”
When it comes to concerns surrounding the SOL Token distribution, Bons said Solana ’s upcoming Token Lockup is more advantageous than other emerging blockchains like Aptos (APT), Sui (Sui) , and Sei (Sei).
“All of these chains are about to see much larger unlocks and the distribution is much more skewed towards “insiders” than SOL. So the anti- SOL extremist narrative is completely out of line with the current reality.”
He concluded his argument by emphasizing his point by saying:
“SOL has an ideal economic design and if someone doesn't realize it, it means they are deliberately ignoring it!”
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Viet Cuong
According to AMBCrypto
