How To Buy Solana (SOL) – Forbes Advisor UK

Solana is an open-source public blockchain that supports smart contracts, including non-fungible tokens (NFTs) and a range of decentralized applications (dApps). Solana’s native currency is called the SOL token.

When Solana was founded in 2017, Anatoly Yakovenko and Raj Gokal wanted to create a blockchain that could meet global demand at blockchain speeds, which at the time were limited to 15 transactions per second (TPS).

One of Solana’s differentiating factors is its high transaction processing speed, with a theoretical throughput of 65,000 TPS compared to 5 and 10 TPS for Bitcoin and Ethereum, respectively (based on Binance estimates). Solana is also a low fee option compared to other cryptocurrencies like Ethereum.

Solana’s investors include well-known venture capital firms specializing in cryptocurrencies such as CoinShares, Coinfund, Alameda Research and Parafi Capital.

According to cryptocurrency research provider Messari, nearly 50% of Solana’s initial token allocation went to “insiders” such as employees and investors, challenging Solana as a true decentralized cryptocurrency system.

SOL was priced at £29 at the time of writing, down 85% from its peak in November 2021 of around £192.

The volatility of price movements has prompted UK regulators to warn investors about the risks of cryptocurrency trading. The Financial Conduct Authority commented that investing in crypto assets “generally carries very high risks” and that investors “should be prepared to lose all their money.”

If you still want to buy Solana after being made aware of the risks, here’s how.

Remember that cryptocurrency trading is speculative and you may lose some or all of your money. Cryptocurrency trading is not regulated in the UK and you would not be entitled to compensation if anything went wrong.

Choose an exchange

You need to sign up with an exchange like Coinbase or eToro to buy cryptocurrencies. There are many exchanges to choose from, each with their own pros and cons.

It’s worth considering the following factors when choosing an exchange:

• Payment Methods: Check if your exchange accepts your preferred payment method, along with the fees charged. For example, not all exchanges accept PayPal as a form of payment, while debit or credit card payments typically incur a 3.99% fee. It is generally considered unwise to use a credit card or other lending facility to purchase cryptocurrency.
• Purses: Check if you can use an integrated wallet to store your SOL. If you decide to store your Solana in a third-party wallet or offline storage device, you should check whether the exchange allows transfers and what fees (if any) they charge.
• Available Currencies: Make sure the exchange trades in SOL.

Choose a payment method

Paying by bank transfer is usually the cheapest way to buy cryptocurrencies, as there are usually no fees for doing so.

While you may be able to pay by debit card, fees may apply and not all card providers allow crypto to be purchased. For example, Virgin Money, TSB and Tesco Bank will block transactions with cryptocurrency exchanges. Although some providers allow you to buy crypto on your debit card, you should be aware of any transaction fees that may apply.

The following table shows the fees of other providers:

PayPal is not widely accepted as a payment method by cryptocurrency exchanges in the UK. However, eToro allows PayPal deposits but charges a $5 fee for withdrawals to a PayPal account.

Place your order from Solana

After selecting an exchange and payment method, navigate to the Solana page on your exchange’s website or app and enter the amount you wish to invest.

Choose your storage method

You have the option to store Solana in your exchange’s built-in wallet, although you can store it elsewhere as long as your exchange allows wire transfers.

You can store your Solana online in a “hot” wallet or offline in a “cold” wallet. Hot wallets are more vulnerable to hacking because cold wallets like hard drives and flash drives are not automatically connected to the internet. You have to pay to use a third-party hot wallet.

If you lose your hot wallet credentials, your exchange or wallet provider may be able to help you recover them to regain access to your cryptocurrency. If you lose your cold wallet access codes or misplace the drive yourself, there is no way to recover it.