Solana Hit By Yet Another Outage: DeFi Users Among The Most Affected
Solana’s network issues continue. This the timing was during a major market downturn, and Solana DeFi users were among the hardest affected.
The Solana network was troubled by congestion issues again Friday through Saturday as the crypto market plummeted.
Solana has faced similar problems in recent months, most notably in September when the network was hit by a 20-hour outage. However this one lasted for 48-hours and had a severe impact on users who had borrowed assets on DeFi platforms like Solend.
According to the Solana team they first noticed the hiccup on Friday, January 21 2022, at about 00:00 UTC.
“The mainnet-beta cluster is experiencing some performance degradation, we are currently investigating the issue.”
The investigation lasted more than 24 hours before the team was able to identify the cause on Saturday at 17:55 UTC.
According to the brief report on the Solana Status page, the issue was caused by “excessive duplicate transactions” done by bots.
The issue was resolved today (Sunday), at about 16:19 UTC after the release and adoption of v1.8.14, which was designed to “mitigate the worst effects of the issue.” The team explained:
“These forthcoming releases are aimed at improving the state of the network, with more improvements expected to roll out in the next 8-12 weeks. Many of these features are currently live on Testnet, where they are being rigorously tested.”
Traders Not Happy
Solana’s network logjam has had ramifications across the crypto-ecosystem. Not only does it make it difficult for a retail market participant to, for instance, sell a Solana-based NFT, it also slows down large DeFi traders and forces them to work around the network. According to one. trading executive, it “slows everything down.”
For large traders moving tens of millions, they have to move activity over-the-counter and agree to settle once the chain is working. “Agree on a price now and settle later… CEXes are still working so you still have price discovery,” an executive at a derivatives trading desk noted.
Others traders complained about not being able to top off a leveraged position in Solana on a decentralized venue — meaning, add to their position before risking liquidation.
These complaints raise questions about Solana’s ability to establish its position as Wall Street’s preferred crypto platform. A firm trying to move around hundred of millions might opt for a different blockchain even if they have to pay hefty fees — if they can count on it to work.
The crypto market has tumbled over the last few days. The global crypto market capitalization has fallen to $1.7 trillion – down more than 40% from its November 2021 peak.
