The cryptocurrency market has shown renewed momentum this week, with Bitcoin and Ethereum leading a broader sector-wide rally after more than two weeks of narrow-range trading. This resurgence has lifted major altcoins, including Solana (SOL) and Cardano (ADA), offering a glimmer of optimism to investors who have endured a prolonged downturn.
Solana, in particular, has reclaimed the $30 resistance level—now a critical support zone—climbing to $31.75 with a 9.27% weekly gain. While this rebound is encouraging, it does little to offset the steep losses SOL has faced since the start of the year, down approximately 82%. In comparison, Bitcoin and Ethereum are down 56.41% and 58.71% year-to-date, respectively. Among large-cap cryptocurrencies, only Avalanche’s AVAX has performed worse.
This sustained decline reflects growing skepticism around Solana’s network reliability and design philosophy—concerns amplified by recent outages and pointed criticism from industry experts.
Solana’s Technical Recovery vs. Structural Concerns
Solana’s ability to stabilize above $30 is pivotal. Should this level hold as support, the next target could be $35—a significant psychological and technical milestone. However, the path upward remains uncertain. The network has failed to close above $32 since early November, suggesting lingering resistance and weak conviction among buyers.
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The price action reflects deeper structural debates within the crypto community. While Solana was designed to outperform Ethereum in speed and scalability—boasting theoretical throughput of over 400,000 transactions per second (TPS)—its real-world performance has been marred by repeated network outages.
Centralization Risks and Network Outages
One of the most vocal critics of Solana is Justin Bons, founder of CyberCapital. He has raised serious concerns about the blockchain’s centralized architecture, arguing that it undermines decentralization—the core tenet of blockchain technology.
In a widely shared critique, Bons highlighted that multiple network failures in 2022 were triggered by single points of failure. For example, in one incident, a misconfigured validator caused the entire blockchain to halt. The recovery process—requiring a coordinated cluster restart—further exposed Solana’s reliance on centralized decision-making.
This centralization is rooted in Solana’s leader-based consensus model, where a single validator proposes each block. A flaw in this node can stall the entire chain. Bons emphasized that while Solana claims high TPS, many of these “transactions” are internal coordination messages counted toward throughput, artificially inflating performance metrics. This design not only misrepresents actual capacity but also increases operational costs unnecessarily.
Questions Over Transparency and Tokenomics
Bons also challenged Solana’s transparency, particularly regarding its Total Value Locked (TVL). A CoinDesk investigation revealed that two individuals used fake developer identities to inflate Solana’s DeFi TVL by up to $750 million—boosting it by over 70% at its peak. This manipulation exploited the ecosystem’s lack of rigorous auditing and accountability.
Further concerns emerged around Solana’s token supply disclosures. Initially, the team underreported circulating supply by 13 million SOL tokens, later admitting they had been lent to market makers. Promised mitigation measures were not fully followed through. When obligations to burn tokens arose, the team issued 8 million new SOL instead—without prior notice—raising red flags about governance integrity.
Security Lapses and Developer Practices
Security incidents have further damaged confidence. Over two months ago, a flaw in certain crypto wallets led to the exposure of unencrypted private keys online, compromising more than 8,000 user accounts. Bons attributed this to lax security practices, noting that most blockchains avoid such vulnerabilities by adhering to strict cryptographic standards.
He warned that Solana’s development culture appears careless compared to industry best practices. Repeated outages—including one on the last day of October caused by validator configuration errors—signal systemic weaknesses rather than isolated bugs.
Firedancer: A Path to Scalability and Stability?
Despite these challenges, Solana’s team is working on solutions. The upcoming Firedancer validator client, developed by Jump Crypto, aims to introduce a second independent client implementation—enhancing network resilience through client diversity. Currently, most validators run the same software (Solana Labs’ client), creating a single point of failure.
Firedancer could improve fault tolerance and scalability, potentially restoring investor confidence. Solana co-founder Anatoly Yakovenko recently showcased the project’s progress at the Messari Mainnet conference, positioning Solana as a leading Layer 1 competitor to Ethereum with its parallel execution model and high-speed architecture.
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Still, whether these technical improvements will address deeper concerns about centralization, transparency, and governance remains to be seen.
FAQ: Understanding Solana’s Current Position
Q: Why did Solana drop so significantly in 2025?
A: The decline stems from a combination of macro market conditions and project-specific issues—repeated network outages, centralization concerns, and loss of investor trust due to transparency lapses.
Q: Is Solana still considered a top altcoin?
A: Yes, due to its high throughput and active developer ecosystem, Solana remains a major player among Layer 1 blockchains despite its challenges.
Q: Can Solana recover its previous highs?
A: Recovery depends on sustained network stability, adoption growth, and successful deployment of upgrades like Firedancer. Market sentiment will play a key role.
Q: What is Firedancer and how will it help Solana?
A: Firedancer is a new validator client designed to increase network decentralization and reliability by providing an alternative to the current client—reducing systemic risk.
Q: Is Solana more centralized than other blockchains?
A: Critics argue yes—due to its leader-based consensus and reliance on coordinated restarts during outages—though the team continues to work on improving decentralization.
Q: Should I invest in Solana now?
A: As with any cryptocurrency, thorough research is essential. Consider network performance, development roadmap, and market trends before making investment decisions.
The recent rebound in Solana’s price offers a short-term reprieve, but long-term viability hinges on addressing fundamental issues. While technical upgrades like Firedancer provide hope, rebuilding trust requires consistent execution, transparency, and adherence to decentralized principles.
For investors monitoring the altcoin space, Solana remains a high-risk, high-potential opportunity—one where price movements are as much about technology as they are about perception.