I've been getting a little suspicious about salana like how can this be possible how can salana have 126 times more transactions than cardano yet this where are the people where's the excitement and why is this happening in the first place Salon has passed $250 but behind the scenes I saw rumors of inflated numbers failed transactions scams wash trading you name it there's some bad data for it so I wanted to do some digging myself and what I found was a story that went all the way from unsettling data to Edward snowed nobody's using it but
for like M coin and scams starting with a pretty shocking breakdown from earlier this year so flip research he had a problem he was hearing a lot of bullish sentiment about salana he believed the hype and he thought it might actually overtake ethereum a lot of people have thought this but his research suggested otherwise it suggested that salana was a house of cards that was just ready to fall but then why do people believe salana is so valuable in the first place well typically one of these reasons it has a high number of users the
network earns a large income in the form of transaction fees and it is a high trading volume on its decentralized exchanges and within stable coins that are native on salana basically the idea is that salana is valuable because a lot of people use it and it makes a lot of money and that would make a lot of sense so this guy flip research he runs the numbers to verify this all himself and compared to eth the numbers look great until he took a little bit of a closer look so you see salana did have higher
daily user transactions but not like a normal amount higher eth was clocking in at 2.92 Daily transactions per user salana was at 217 transactions per user per day we're talking almost a 100 times more the average person was making over 200 transactions per day that's it seems off Google Trends suggested that ethereum was consistently more popular than salana during that time so where are all these transactions coming from well as the image he posted says the secret ingredient might just be crime he found an enormous amount of salana projects that had rug pulled in the
last 24 hours alone that is scammed everyone not only that but the vast majority of the wallets involved seem to be bots in the same network with tens of thousands of transactions this meant that they could generate fake volumes and fake numbers of transactions until the project rug pull and the Bots would move on to the next rug pull he found evidence of over 50 rug Poes which generated more than 200 million in volume and $500,000 in fees and by comparison he struggled to find any rugs on ethereum that had any meaningful volume now if
you're confused about the bot part check this out Antoine Roso literally showed how easy it is to Launch a token with fake wallets that buy automatically meaning the pump looks legit but it's complete BS and he says trust nothing verify and this isn't the first guy who's noticed suspicious transactions all you have to do is look and you'll see people pointing out things that just don't make sense anyone who's using a chain and using a chain that deals with a lot of real legitimate people once they look at the activity they're like wait what and
then they look in the numbers and they're like well yeah this doesn't add up here cardano Yoda he breaks down how 90% of salana users are generating by Bots and there's simply no active Community whatsoever but back to our original thread with flip he thought that there were a few key implications from all of this the data suggested that 93% of Trades and fees on salana were fake 93% of everything he thinks is fake he calls them nonorganic trades and on top of this trading fees earned and trade volume is highly inflated as well and
again many other people have noticed similar patterns GPH hunter. eth he felt that this was all questionable salon data and it was suggested of wash trading wash trading is where you sell and then immediately Reby an asset a trade is made but the ownership doesn't meaningfully change what this does is artificially pump up the trading volume because on paper more money is being traded but actual ownership doesn't change this is backed up by data that suggests that 80% of active addresses on salana trade less than $10 and it appears that they're only getting better at
this they're only getting more sophisticated they're figure out methods to make this more undetectable so that's a lot of signs pointing towards these practices happening on salana and there's way more continuing with flips thread he looked into me maximal extractable value this is sometimes referred to as an invisible tax an invisible tax that miners use to extract value by reordering transactions so unlike traditional Finance where transaction orders are rigidly enforced crypto miners can order them as they please so naturally some of them do it for personal gain using Bots to find transaction opportunities where the
maximal amount of value can be extracted essentially ahead of that transaction and well according to Flip's research most of the value on salana is being derived from me and that they're particularly vulnerable to sandwich attacks with one apparently happening every 4 seconds and if you don't know a sandwich attack is where a bot spots your transaction before it's included so it pumps the price beforehand and then sells right after yours pocketing the difference and leaving you with a higher costing token and again this is apparently happening every 4 seconds flip felt that with Solana's huge
quantity of high volatility low liquidity mem coins this was the perfect environment for Bots to extract value from Ms one sandwich bot on salana pocketed $30 million in two months that's $30 million in value extracted from the real users of salana Simply as a tax for using that ecosystem that's insane as long as huge amounts of mem coin activity are driven to salana sophisticated players are going to continue to exploit it this isn't illegal they're going to use me and insider trading on said meme coins to dump on everyone else and the story also doesn't
end here because flip looked at retail value extraction in other words coins that celebrities pumped and then dumped the results were pretty ugly unsurprisingly not just for like the Haw Tua coin just in general most were down by 90% or more and their promotional tweets are just deleted from the celebrity accounts the best perform actually was Andrew Tate's daddy coin this coin performed at -73 so not exactly a winner either that's the best more evidence suggested rampant insider trading devs dumping on buyers a story is old as time so all in all a complete Nightmare
and we haven't even touch salon's poor chain stability numerous outages and high rates of failed transactions I mean the amount of failed transactions is appalling and now I'll read you the conclusion to Flips analysis and then we'll get into why this is happening in the first place I believe that the commonly cited Soul metrics are significantly overstated furthermore the vast majority of organic users are losing money onchain to Bad actors at a rapid Pace we are currently in the Mania phase where retail flows are still outperforming outflows to these sophisticated players allowing for positive Optics
once users are fatigued from ongoing losses many of these metrics will collapse quickly but outside of flip research and Twitter at large what are other people saying about salon well Edward Snowden he had this to say I mean when you look back at the the Bitcoin white paper I I think what you see is an adversarial approach to the system and that's really what you have to be considering a lot of people and you know I I don't want to name names but salana uh are taking good ideas and they're just going well what if
we just centralized everything it'll be faster it'll be more efficient it'll be cheaper and yeah sure it is right but nobody's using it but for like meem coins and scams because if anybody puts anything significant on it and then all the states begin moving towards it it's going to be a system that has levers that people can simply just take from you you have to be thinking for the adversarial case as opposed to the convenient easy early case I mean that's uncomfortable for like a lot of these founder mode people were like oh no we
need the minimum viable product this that and the other sure um if you're trying to get rich that'll work you know a lot of people have demonstrated that they'll continue to do that but if you want something that will last you have to engineer near it to last and that means thinking about how it's going to be attacked and making sure it can survive that because we at crypto were living on the X around right you are at the intersection you are where the bombs are going to drop uh let's make sure that we have
roofs that can survive them so essentially he's saying salana is pushing for more and more centralization to make money which is completely contrary to the nature of Bitcoin and kind of crypto in general it's decentralized by Design the major draw of Bitcoin is decentralization it makes it extremely robust when something is decentralized nobody can control it or extort it but with salana that just isn't the case so from this perspective salana is fundamentally broken without the design principles that make Bitcoin and many other cryptos so secure so when you pile on that perspective on what
we've already talked about the doesn't really paint a great picture for this network what are people saying in salon's defense we want to look at all sides of the story some have pointed out that salana is partnered with Google and other large companies which can be double checked on their website and this absolutely gives the project legitimacy there's many billionaires holding this thing as well there's many celebrities Associated there's no shortage of reasons to At a Glance go oh yeah looks good that's kind of the whole thing is built around looking good at a glance
I also saw another user point out that the NASDAQ is 99% bots so salana being primarily Bots not a big deal I mean I do get that argument I will say the NASDAQ is more like 60 70% Bots but I get the point another one pointed out that no ecosystem is free of rugs and scams which is totally true but the fishy thing here is just how many are happening on salana and in wider news salana had the breakes put on its ETF for now I mean there's still hope on the horizon it could very
well happen Trump's sec pick Paul Atkins he's a lot more Forward Thinking and Innovative especially in this vein which could mean salana at least secures a future in an ETF however if the claims made by investigators like flip are correct then they've got a lot of shady stuff to fix before something like this realistically could happen but what do I think I think the answer is actually really simple it was clear in 2021 that people wanted a cheap defi alternative to ethereum ethereum gas fees were out of control people wanted defi but it was just
too expensive for the average person however to be a cheap decentralized and secure blockchain that allows for daps to be built on top this would take many many years to build so if I were to guess a plan was devised to make a blockchain with a few tradeoffs build a blockchain that focuses only on the measurable success metrics what do people care about let's optimize for that thing and then we'll gain a bunch of popularity and by the time other people are able to catch up we'll be so big and have so much money that
we'll be able to fix everything and fix this sinking ship before it totally capsizes what I mean exactly here is there was an incentive to make a blockchain that looked like it was cranking hundreds of trans actions per second across millions of wallets trading hundreds of times per day because if they built that then the world would simply be able to point to it and go that's it that's the chain that has the best metrics that everyone cares about they know there's a potential trillion dollar reward if they can pump all the numbers long enough
to just give them enough time to fix everything that's wrong or everything that's just a flat out lie so it's pretty clear why they do it and maybe eventually they figure it out and they go completely legit and they go transparent with all their numbers but that's not a reality I'm going to count on right now the most important thing you can do in crypto is research and squint your eyes and question things when they don't seem right because man in crypto yes it's 2024 there are a lot of things that just aren't right and
don't make sense for a clear obvious reason if you just look at it if you don't know where to start just follow your Curiosities and you'll start getting leads and you'll realize how few amazing opportunities there are but the amazing ones generally stand out pretty quickly you look look into them you're like oh it just makes sense let me learn more about this let me check all my boxes and generally it's a pretty good investment opportunity especially if you can figure that out before other people if you'd like a more structured approach on how to
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