In a recent tweet, Solana co-founder, Raj opened up about a concerning trend prevalent in the blockchain and crypto space in the last three quarters of 2022 and the first quarter of 2023. Raj revealed that several venture capitalists (VCs) advised companies against using Solana for their projects. Some went as far as to declare, “we don’t invest in Solana projects.” This revelation sparked a discussion within the crypto community.
The post quickly gained significant attention, drawing comments from notable figures in the industry. Chris Burniske, formerly a leader at crypto ARKinvest, predicted a shift in the VC sentiment, stating that it would transition from “We don’t invest in Solana projects” to “We’re underexposed to Solana.” He anticipated bidding wars as interest in the token projects surged, highlighting the quality of entrepreneurs in the ecosystem.
Burniske also offered valuable advice to startups, encouraging them not to raise more capital than necessary and to avoid excessive dilution. He emphasized the potential for lean and efficient operations in the crypto space and cautioned against the misconception that large funding rounds equate to success.
Famous trader Marky shared a similar sentiment, asserting that while there has been a shift in interest since the summer, many VCs still follow the herd mentality, favoring Ethereum and Layer 2 solutions. He pointed out that some VCs needed more proper research, believing that Layer 2 transaction fees were on par with the network and expressing concerns about Solana’s centralization.
Solana’s Remarkable Year-to-Date Performance
Despite the VC hesitance, Solana has performed exceptionally well in the crypto market. According to data from CoinGecko, the token has achieved a remarkable 214% gain this year, making it one of the best-performing crypto assets. In comparison, leading cryptocurrencies Bitcoin (BTC) and Ethereum (ETH) saw increases of 106% and 50%, respectively.
Despite its challenges, such as the FTX/Alameda crisis and network congestion, the token has maintained a year-to-date uptime of 100%. The blockchain has also achieved significant adoption milestones, with Visa introducing USDC settlement on SOL in September and Solana Pay integrating with Shopify in August. Nevertheless, the crypto community eagerly awaits whether the sentiments expressed by VCs towards SOL will evolve in light of its continued success and growing adoption.