Solana, a public blockchain known for its high transaction speeds, is under renewed scrutiny. After challenges with reliability in recent years, analysts are highlighting another concern.

Solana faces new challenges in transaction processing

To X, one user said the network has alarmingly high transaction error rates. This performance issue, the analyst added, tends to significantly impact user experience, thereby mitigating the network’s advantages, which are primarily focused on low gas costs and high scalability.

The sharing of transaction data from Jupiter, a DEX aggregator on Solana, paints a troubling reality. For every 24 hours, the analyst noted, only 35% of all placed trades go through. This means that a majority, around 65%, are not processed.

The analyst further explained that the situation is even more serious, as analyzed in the past month. On some days, the analyst observed that the transaction failure rate could exceed 80%. At this rate, and on those days, only two out of ten transactions placed on Solana are confirmed.

The low transaction success rate comes despite Solana proponents pointing to its high transaction processing speed, which is far better than Ethereum and Bitcoin. If the success rate is any indication, the analyst said the metric could be misleading, as it takes into account all failed transactions.

For this reason, the higher TPS is false and only inflates Solana’s on-chain performance. This position is because Solana, given its high failure rate, treats failed transactions as successes, creating a false impression of the platform’s capabilities.

When transactions fail, it negatively impacts the user experience, as users are charged fees for each transaction placed. In essence, this means that Solana is punishing users for using the network.

Will interested financial institutions like Visa pull out?

The situation worsens because Solana attracts bots that flood the network with low-fee transactions. This translates into a high failure rate for regular users who fail to optimize their gas costs accordingly by paying more.

The analyst added that Solana’s high transaction failure rate could even cause large financial institutions, such as Visa, to reconsider their decision. If they choose to implement on Solana, users who are accustomed to the reliability and high processing speeds of traditional payment rails may be hesitant to adopt the technology.

While the high failure rate indicates high demand, Solana is plagued by other issues. Recently, the Solana Foundation banned over 30 validators from their grant program for facilitating Miner Extractable Value (MEV) bot activity.

Main image from Canva, chart from TradingView