3 - 5 minute read
Solana, the layer-1 blockchain, has announced a new solution to lower on-chain storage costs. State compression has been developed to bring down the cost of producing one million nonfungible tokens (NFTs) from the current $2.6 million range to around $110. Compressed NFTs are much cheaper than uncompressed peers with similar structures of data.
Solana Foundation tech lead Jon Wong explained that the state compression solution relies on Merkle trees, a popular data structure known for its capability to ‘compress’ the verifiability of a tree of data into a ‘hash’, or a ‘fingerprint’ of the tree’s current state. The Merkle roots are stored on the chain and updated in Solana’s ledger, cutting down data storage costs without sacrificing decentralization. The technology can compress any form of on-chain data.
State Compression: A Partnership Across Ecosystems
Solana’s state compression initiative is a joint effort across different ecosystems. Developers from Solana Labs and Metaplex came together to create the solution with support from Phantom, Solflare, powered by RPC node providers, and indexers Helius, Triton, and SimpleHash. Among the projects already utilizing state compression technology are Dialect, Crossmint, Helium, and Wordcel.
1/ Solana’s low fees have made it an industry leader. But thanks to a recent innovation from teams across the ecosystem, it’s about to cost even less.— Solana (@solana) April 6, 2023
Introducing state compression, a new way to store data on Solana that lowers cost significantly. https://t.co/0baMJ0vOn1
Twitter users have already reacted to the solution positively, with some users describing it as a game-changer and a path to make Solana a more viable option for enterprise use cases. Encouraged by the successful deployment of the state compression technology across several projects on Solana, developers are hopeful that other blockchains can adopt similar solutions to offer users cost-effective and secure data storage.
What Does This Mean for SOL?
With state compression technology now available on Solana, traders and investors of NFTs can yield higher margins on relatively lower investments. As it stands, Solana is well-positioned to become the go-to blockchain solution for enterprise use cases thanks to its strategic cost-cutting technologies. Longer-term investors can take solace in the fact that Solana continues to bolster its blockchain’s infrastructure and explore the integration of other complementary technologies.