Howdy!
I’m ashamed to admit I have yet to listen to Anatoly Yakovenko’s debate with Justin Drake. However, I want to publicly thank them both for rescuing my X timeline from a days-long slog of Iggy Azalea memecoin takes.
More on the layer-1 esprit de corps later, but first, let’s take a look at what’s happening on the blockchain:
SolXEN may be filtering Solana spam
Something interesting is happening with Solana’s transaction chart.
For the past few months, a sizable majority of Solana’s transactions have been failing. This flipped last week when 15 million daily failed transactions disappeared from the network, seemingly overnight. Now, for the first time since Blockworks Research began tracking this particular metric, a majority of transactions on Solana’s blockchain are succeeding.
This sudden shift has held up for six consecutive days.
Source: Blockworks Research
While trying to figure out what happened, multiple roads led me towards SolXEN, a newly launched Solana token that is mined using proof-of-work, the consensus mechanism popularized by Bitcoin. Its per-token value is essentially zero, according to Raydium, but more than nine billion tokens have been mined in roughly the past week.
(I saw the Solana-based developer Brian Long say he was working on changes to the Solana network at around the same time SolXEN launched, so that could be a second plausible explanation.)
SolXEN is wrapped up in XEN, a broader crypto project founded by Jack Levin, who was a Google engineer in the early aughts, according to his LinkedIn. He’s a colorful character.
“[H]umans seek pleasure, and advanced humans seek hardship. This hardship is visible all over the XEN whitepaper,” reads one line in his kind-of-hilarious bio page on XEN’s website.
XEN’s mining mechanism has been known to hog up space on other networks. A Paradigm data analyst complained in early April that 68% of Base’s chain storage was being taken up by XEN.
On Solana, you could maybe foresee this kind of thing going poorly, given the chain’s occasional struggles with congestion. But so far, SolXEN appears to be taking up space that would otherwise belong to bots.
In a reply post on X, Solana co-founder Anatoly Yakovenko called SolXEN an “Unintentional [arbitrage] spam filter.” Failed transactions on Solana are largely initiated by bots making use of cheap fees to spam the network with transactions.
I spoke with Blockworks Research’s Dan Smith to wrap my head around how this spam filter could be working.
Solana blocks contain up to 48 million compute units [CUs], which can be roughly compared to Ethereum gas, Smith explained. Transactions use up more CUs when they succeed than when they fail. Since SolXEN transactions do not compete to touch the same state, SolXEN transactions succeed more often than highly-competitive arbitrage bots. As a result, the 48 million CU blocks are being filled up with heavier SolXEN transactions rather than lighter failed bot transactions.
If failed bot transactions are like dropping nickels into the blockspace jar, then SolXEN mining throws in dollar bills.
But depending on how you look at things, SolXEN could still be portrayed as spam — in which case, spam is crowding other spam out of Solana blocks. Low fees make for one interesting state of affairs.
— Jack Kubinec
Zero In
Here’s another way to look at Solana’s sudden spam slide. In a matter of days, the failure rate for users sending more than 5,000 transactions per day (i.e. large bots or people who need serious help) fell by 15%.
By Blockworks Research’s count, that puts members of the 5,000+ club’s odds of landing a given transaction at around 50/50.
Of note, the number of successful transactions stayed flat overall while the number of failed transactions declined, so it’s not like bots are getting a ton more transactions to land. They’re just sending fewer failed transactions to the blockchain.
— Jack Kubinec
The Pulse
Speed versus security. That’s the hot topic on X following a debate hosted by Bankless between Ethereum researcher Justin Drake and Solana co-founder Anatoly Yakovenko.
Drake praised Solana for its low fees and rapid transaction speeds, but pointed out its centralization risks and less mature infrastructure. Yakovenko highlighted Ethereum’s strong network effects and robust security while criticizing its high costs and scalability issues.
The debate overflowed onto social media, where Yakovenko tweeted, “We all won in the debate because it really kicked the hornets nest and now everyone is talking about hard interesting problems again.”
This sparked further discussion on various solutions to the tradeoffs. Espresso Systems CEO Ben Fisch suggested a hybrid approach, stating, “You could have a network of clients that track Solana consensus but only consider blocks final after they are placed in Ethereum DA.” Yakovenko countered, “Why can’t someone post a Solana state root to eth for the exits, zkp or optimistic?”
Researcher Emmanuel Awosika raised concerns about the prevalent focus on total value locked (TVL) as a key metric of a network’s success, stating, “I usually find people using TVL as the most important metric to be problematic.” User Qw Qiao added, “I do see a small but nonzero chance in the next ~2 years that a giant L2 achieves extremely high TPS at low cost, enabling new use cases that force Solana to go modular.”
It’s a debate the industry seems to love having…over and over on repeat for a decade across various matchups. But choosing between a friction-free user experience and the actual security of the network continues to normalize an ominous compromise. How much longer are we going to have to choose one or the other?
— Jeffrey Albus
One Good DM
A message from Marc Zeller, founder of the Aave Chan Initiative:
