Editor’s Note: Solana has performed exceptionally well during this cycle, with on-chain meme transactions and token prices continuously pumping. This can be attributed to the Solana Foundation’s focus on improving infrastructure performance, reducing latency, to meet market demands and drive the growth of founders, applications, and tokenization projects.

The following is the original text (for ease of reading comprehension, the original content has been slightly reorganized):

Internet Capital Market and F.A.T. protocol Engineering

Solana’s promise is to enable anyone with internet access to participate in the Capital Market. Now, all you need to do is download a Wallet or application, click a few buttons, and you can join the internet Capital Market - a globally accessible ledger that enables the tokenization of assets, currencies, and culture.

Why is this important?

It helps us create a world where anyone can have assets anytime, anywhere with just an internet connection. These assets can be global companies, real estate, commodities, or even cultural expressions. This lays the foundation for ‘universal basic ownership.’ The competition for high-performance L1 is not just about building a decentralized NASDAQ, but also creating a successor to an internet-native NASDAQ - a Capital Market with better accessibility, lower latency, and shared global liquidity.

The opportunity is both simple and huge: currently, only about 15% of the global population can participate in the Capital Market of the United States - the market with the strongest Liquidity in the world. Many other countries’ Capital Markets lack Liquidity, have high entry costs, and low Settlement efficiency. The Cryptocurrency market is more accessible and has greater Liquidity. At its peak, its volume even surpasses NASDAQ and NYSE. We have the opportunity to build the best Capital Market on the Internet.

In the future, the company will directly list “on the Internet” and be able to reach over one billion investors who hold the Private Key—using their funds to vote on the future they want, not limited to stocks, but also including all valuable asset classes, cultures, and ideas.

How to accelerate towards this future?

This is the meaning of the F.A.T. protocol project. In the past, this industry was mostly built on the idea of “value primarily concentrated in the infrastructure layer” (Fat Protocols, 2016). After 8 years, we are still building infrastructure because it often attracts higher valuations.

In contrast, Solana’s ecosystem chooses to bet on products, which was reflected at the Breakpoint conference in 2024. By focusing on founders, applications, and tokenization, Solana’s market share in the transaction fee market - an excellent indicator of ecosystem activity and overall health - rose by 1,489% in 2024, reaching 12%.

F = Founder, not just a developer

Now, for a group of determined founders, it has never been so simple and quick to go from starting a business in a garage to becoming a billion-dollar company with just an internet connection.

1.tensor: Two founders from Canada, the company is valued at 4.45 billion US dollars

2.pump.fun: The British team achieved $155 million in transaction fee revenue in 8 months

3.birdeye: Headquartered in Vietnam, the user base reached 24 million by 2024

The startup flywheel will continue to spin rapidly in 2025, and the colosseum Hackathon (Solana’s Hacker Marathon) is the largest talent discovery and talent growth program in the encryption field, with its past participants having raised a total of 6.5 billion USD in financing.

This flywheel benefits from the support of an ecosystem built for scalability: from the hub of superteam, the workspace of shipyard, to the accelerator of solanaturbine, community-driven infrastructure further accelerates the growth rate of founders.

A = Application, not just infrastructure

Infrastructure represents uncertain optimism, while applications represent certain optimism. The Solana ecosystem prioritizes products that truly meet the needs of users. What are the results?

In October alone, app revenue reached $73 million, an increase of 185 times year-on-year, now leading all networks. In addition, 74% of the funds in the ecosystem flow to apps (compared to 40% for Ethereum), because the founders follow the users’ needs.

Solana has always adhered to the idea that what matters is not TVL, but the gathering place for economic activities. The chain GDP (revenue generated by applications) is the primary indicator of measuring the long-term success of the protocol. When the revenue generated by applications exceeds the underlying layer, it indicates that the protocol layer has achieved product-market fit. If your infrastructure layer is exploitative, applications will leave and establish their own chain or migrate to other on-chain solutions.

Study the Laffer Curve.

T = tokenization, not just TVL

TVL is a passive, self-referential indicator. Active indicators such as capital efficiency and volume are more informative. The ultimate goal is that Solana is the best platform for Internet asset issuance. In the past 6 months, we have witnessed the release of 2.6 million Tokens, accounting for 78% of the total on-chain volume. Although memes may occupy a larger share of public consciousness, they are not the only things rising.

The treasury balance has doubled, reaching 1.34 billion US dollars, stablecoin rise by 120%, reaching approximately 40 billion US dollars, including 4.2k physical assets of BAXUSco and dvinlabs, 190 million digital collectibles of drip haus, and over 1 million hotspots of helium, these are just some examples.

With adoption, tools, and regulatory follow-up, super tokenization will accelerate development - this will become a globally accessible ledger, and all assets will be tokenized.

Each component of F.A.T. is mutually reinforcing: more founders launching products, more products attracting users, more users driving tokenization of more capital, and more capital attracting more founders. In just Q3 2024, the Solana native team raised $178 million.

The “protocol” section in the F.A.T. protocol project

Teams focused on core protocols (such as Anza, Jump, Jito, etc.) are working hard every day to improve performance and optimize the experience. They strive to enhance Solana’s performance and capacity at the underlying layer by pushing the limits of hardware and software. Increasing bandwidth and reducing latency are key strategies for Solana, emphasizing its continuous commitment to practical infrastructure development rather than solely focusing on valuation.

Finally, I refer to it as engineering (rather than theory) because it articulates an inherent important value in the ecosystem. A product culture that is opinionated but pragmatic, making difficult trade-offs continuously, launching and iterating in the real world to find product-market fit (PMF). This culture attracts practitioners, not just academics.

As the ecosystem continues to grow, we should maintain this culture, rather than becoming dogmatic, or worse, complacent due to any temporary success. The development of Crypto Assets is rapid, and we will always remain flexible.

Currently, it is expected that the Foundation’s marketing activities will support these core pillars through various events and content – celebrating the best founders, applications, and tokenization projects, while teams continue to work on improving Solana’s speed and performance. In addition, given that the innovation renaissance seems to be unfolding in the United States, we will also refocus on the U.S. market.

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