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‘Solana Is Deceptively Designed to Falsely Inflate Usage,’ Alleges Crypto Researcher

CyberCapital Founder and CIO Justin Bons criticized Solana heavily on Twitter, detailing its bad track record of downtime, failures, hacks, and scandals.

Founder and CIO of CyberCapital Justin Bons made some stark remarks on the Solana network and its native cryptocurrency (SOL) in a lengthy Twitter post published on Oct. 3.

The crypto researcher said that there was “blatant fraud” involved at the birth of SOL and discussed how there were false statements made with regard to the circulating supply of the cryptocurrency.

1/25) Solana has been marred in controversy since its founding

With frequent downtime, failures, hacks & scandals!

This is why I have put together a short & incomplete history of SOL’s skeletons

Working our way down a colorful history of lies, fraud & dangerous trade-offs:

— Justin Bons (@Justin_Bons) October 3, 2022

The entire Twitter thread harshly criticized Solana and its operations, referring to “frequent downtime, failures, hacks & scandals.” Regarding SOL’s total value locked (TVL) and circulating supply, Bons had a lot to say. The researcher said “that the majority of SOL TVL was fake” when “two devs pretended to be 10+ devs & counting the same TVL over & over,” which “accounted for 70% of SOL’s $10B TVL at its peak.”

Bons stated that the team said there was a circulating supply of 8.2 million SOL in April 2020 but that there was actually over 20 million SOL. He also referred to a third party that found an unlocked SOL wallet that had more than 13 million coins. The SOL team responded by saying that these were loaned to a market maker and promised to burn them within 30 days.

Bons provided a source that contained all of the information he discussed. He says that the history of the project points to bad behavior. Among these are lying about the circulating supply and transactions, a “deceptive design to falsely inflate usage,” and the SOL ecosystem being “complicit in ‘faking’ peak TVL numbers.”

Reputation dented by outages

Solana has experienced a number of network outages, which have made the headlines and brought scrutiny to the usability of the network. Most recently, the network was down for over three hours on Oct. 1, which occurred because a single validator created an invalid block. The manner in which the issue was fixed also drew attention, pointing to the fact that a centralized decision was made.

The Solana network also went down on Jun. 1 this year, when a transaction bug stalled the chain and led to four hours of outage. Bons stated that this was also due to centralization issues.

Then was a network outage caused by arbitrage bot spam in January 2022. Solana also experienced multiple outages in late 2021, and this track record has not done well for its reputation.

Solana NFT market grows

However, despite the series of negative incidents, the Solana ecosystem has been growing steadily. The NFT market on Solana grew to a market share of 24% in September. The month saw over $135 million in transactions, with MagicEden dominating volume with over 90% of the market.

This was despite Solana hitting an all-time low in NFT sales volume in July 2022. The ecosystem has managed to bounce back, but it remains to be seen if it will stick.

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