Last week, Bank of America (NYSE: BAC) said the Solana blockchain could become the "Visa (NYSE: V) of the digital asset ecosystem" because it focuses on scalability, low transaction fees, and ease of use.
BofA analyst Alkesh Shah told clients in a note Tuesday after hosting Solana Foundation member Lily Liu: "Solana prioritizes scalability, but a relatively less decentralized and secure blockchain has trade-offs, illustrated by several network performance issues since inception," adding that its main competitor Ethereum struggles with poor scalability that leads to long network congestion and high transaction fees. Solana has enjoyed strong adoption since launching in 2020.
Shah noted the network has settled over 50 billion transactions, boasts over $11 billion in total value locked, and has been used to mint over 5.7 million non-fungible tokens. Therefore BofA believes Solana is optimized for consumer use cases such as micropayments and gaming, and the financial giant projects Solana and other newer blockchains can take market share from Ethereum over time via adoption and differentiation.
Here is the rest of the week in review:
Bill Miller, the market-beating fund manager and billionaire, revealed he feels so bullish on Bitcoin (BTC) that the major coin and closely related investments tied closely now comprise 50% of his personal net worth, in a video interview with WealthTrack published Friday. Miller gained fame for beating the S&P 500 (NYSE: SPY) index for a record-breaking 15 years in a row from 1991 to 2005 as a fund manager at Legg Mason (NYSE: BEN), and he has previously invested heavily in Bitcoin in funds that he managed. Miller said he personally started purchasing Bitcoin at about $200 apiece in 2014 after hearing a talk by Silicon Valley evangelist Wences Casares, adding he bought some more coins over time. He noted he started buying Bitcoin again last year at $30,000 during the crypto crash, believing that more people are using it and more venture capitalists are investing in it. Miller said he considers Bitcoin as digital gold with a strictly limited supply and game-changing technology. Despite his own heavily concentrated position, Miller advised average investors to only place 1% of their net worth in Bitcoin due to affordability and diversification. Miller touted Bitcoin as a good hedge against "financial catastrophe" and unique investment.
A group of U.S. banks plans to offer their own stablecoin dubbed USDF, in a move to tackle concerns about the reserves behind nonbank-issued equivalents. The group said Wednesday the new coin "addresses the consumer protection and regulatory concerns of nonbank issued stablecoins." Founding members of the USDF Consortium include Synovus (NYSE: SNV), the 48th largest bank in the US by assets, New York Community Bank (NYSE: NYCB), FirstBank (NYSE: FBP), and Sterling National Bank (NYSE: STL). The consortium also wants to attract more banks to join. According to the consortium's proposal, USDF would be a bank-minted alternative to USDT and Circle's USD Coin (USDC). USDF will live on the Provenance blockchain and be redeemable 1-to-1 for cash from any consortium members. The group believes the stablecoin will be used for applications including capital call financing and supply chain finance. Although the financial institutions are FDIC-insured, their statement does not specify whether the reserves backing USDF will be. The FDIC has been considering whether stablecoin reserves should qualify for its pass-through insurance, which would cover stablecoin holders up to $250,000 if the bank holding the collateral were to fail, but the regulator has not made a formal decision yet.
Crypto prices edged up to $2.07 trillion this week. For the majors, all except stablecoins ended in the green. In the top 100, the biggest decliners were Loopring (LRC), down 16%, Internet Computer (ICP), down 15%, and Chainlink (LINK), down 9%. The biggest gainers were Oasis Network (ROSE), up 52%, Secret (SCRT), up 43%, and NEAR Protocol, up 42%. Next week traders will see if the market makes a bigger move.
The author owns a small amount of BTC.