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Sygnum Bank Report Reveals Growing Institutional Preference for Solana Over Ethereum In an October 1 report, Sygnum Bank highlighted a growing trend among financial institutions favoring Solana over Ethereum due to Solana’s superior scalability, as reported by Cointelegraph. The Swiss crypto bank’s report points to active industry engagement with Solana, noting that major players like Visa are using it for USDC settlements, and Franklin Templeton plans to launch a mutual fund on the platform. Additionally, Citi is reportedly exploring Solana for cross-border payments. Despite these developments, Edward Snowden has raised concerns regarding Solana’s centralization, which he warns could make the platform vulnerable to state interventions. Why Financial Institutions Favor Solana Over Ethereum Solana’s scalability is a key factor driving institutional interest. While Ethereum remains the dominant blockchain for decentralized applications (dApps) and smart contracts, its relatively lower throughput and higher transaction costs have led institutions to explore alternatives that can handle larger volumes of transactions. Solana’s architecture, which employs Proof of History (PoH) alongside Proof of Stake (PoS), allows for faster and cheaper transactions, making it an attractive choice for large-scale financial operations. As demand for scalable blockchain solutions grows, Solana has positioned itself as a viable alternative to Ethereum, particularly for institutions requiring high throughput. Notable Institutional Engagements with Solana The report by Sygnum Bank highlights several high-profile projects and endorsements that have contributed to Solana’s increasing institutional appeal: Visa has chosen Solana for USDC settlements, reflecting a significant endorsement of Solana’s capabilities for handling stablecoin transactions at scale. Visa’s move underscores the platform’s potential to support global financial infrastructure. Franklin Templeton, a leading investment firm, is planning to launch a mutual fund on Solana, marking one of the first instances of a traditional financial product being offered on a blockchain known for its scalability. Citi is reportedly exploring…

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Filed under: News - @ October 4, 2024 4:24 am