Austin Federa, head of strategy at the Solana Foundation, spoke to Cointelegraph at the ETH Denver conference about network outages, the impact of regulation, and the launch of its mobile device.
Speaking to Cointelegraph on March 1, Federa said that the New York Department of Financial Services – NYDFS, one of the state regulators responsible for licensing crypto companies – was essentially placing blocks on many projects seeking to issue stablecoins or similar blockchain services. He added that Solana had heard of projects running up against “quite draconian” rules in the European Union relating to liability around illicit transactions.
“The DFS has not certified Solana yet,” Federa said. “We’re trying to get it going, but I think what we’ve seen is a lack of appetite from the DFS anywhere.. If a new entrant—say, a large web2 financial services company—feels they want to start issuing a stablecoin, they feel they need DFS approval to do something like that.”
In response to the recent slowdown in block production that led to a Solana network restart, Federa said there was “no specific root cause analysis” reported by the team’s engineers. He added that there may have been “something about the interaction” between version 1.13 and 1.14 of the network or in the last update attempt that forced the validators to restart.
“The problem with version 1.14 is that it was running on the testnet for months before it was moved to the maintenance release”explains Federa. “So what it really highlighted is that the testing infrastructure for releases isn’t as robust as it should be right now, because it wasn’t just something that was just thrown out onto the mainnet. What happens is that the tests did not detect the error”.
Federa said that Solana’s approach has been to develop an ecosystem faster in a matter of months than networks like Ethereum had taken years. He added that many projects were suffering from VC funding amid the bear market and negative press coverage associated with crypto and blockchain, with stability a major factor in user retention.
“One of the risks there is downtime and so there’s been a sacrifice of stability to get more stuff out faster to help the network grow faster.”
The root cause of the 2-25-23 outage is still unknown and under active investigation. The following document will be updated as new information becomes available https://t.co/kKYaTuizu0
— Solana Status (@SolanaStatus) February 27, 2023
FTX’s collapse in November 2022 sent ripples through Solana’s mobile ambitions as well. According to Federa, Solana had temporarily suppressed its fiat-to-crypto “tap to pay” feature without a replacement for FTX – the company was expected to facilitate transactions – but planned to launch it in “the first week or two of April.”
Many on social media have criticized Solana for network outages, with various causes including a denial-of-service attack in 2021, congestion of non-fungible token minting bots in May 2022, and a failure of consensus in June 2022. The cause of the most recent outage was still unknown at press time, but Solana Labs founder and CEO Anatoly Yakovenko said it was not the result of clogging the network’s chain voting system.
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