Assessing the impact of Helium [HNT] migration on Solana’s [SOL] NFT landscape
- The minting of Helium hotspots as NFTs served as an effective test case for Solana’s state compression capability.
- NFT sales worth nearly $30 million were logged on the chain over the past week, marking a jump of 117%.
Helium [HNT], abandoned its own layer-1 blockchain and switched over to the Solana [SOL] mainnet last week, marking one of the biggest transitions in the decentralized network history.
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As part of the migration process, each physical hotspot node operating on the Helium network will have a corresponding NFT on Solana. This will ultimately create over 1 million new NFTs. According to blockchain analytics firm Messari, over 350k hotspots have already been minted on Solana.
.@helium's migration to @solana marks one of the largest decentralized network transitions in history.
Over 350K hotspots have migrated with limited issues reported. pic.twitter.com/Zohdf2TEfC
— Messari (@MessariCrypto) April 25, 2023
Big boost to Solana’s NFT space
As per Solana Foundation, the rationale behind minting an NFT for each hotspot was that it would serve as the hotspot’s credential and confirm its authenticity without the requirement for a centralized server. Moreover, the hotspot-as-NFT could provide data for developers to build programs on top of Helium.
The migration of Helium hotspots served as an effective test case for Solana’s state compression capability, which it unveiled recently. As per Solana’s claims, large amounts of NFTs can be minted at a fraction of the cost of Solana’s standard minting process or that of other blockchains.
In the example provided by Solana, minting a million uncompressed NFTs costs more than $250,000 on the chain as of April 5. The same will cost $113 using compressed NFTs.
Meanwhile, NFT activity gathered pace over the last week. NFT sales worth nearly $30 million were logged on the chain, marking a jump of 117%, data from CryptoSlam revealed. There was also a sharp rise in the number of buyers and sellers as well, increasing by 35.45% and 30% respectively.
User base expands with Helium
The arrival of Helium helped in bolstering Solana’s user base. As per Token Terminal, the number of daily active users soared 16% over the previous week.
However, the growth in users failed to provide a significant boost to trading volume. This led to transaction fees collected on the network declining 6% in the last week.
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At press time, SOL rallied 7.88% in the last 24 hours, data from CoinMarketCap showed. Solana’s announcement on partnership with Google Cloud to set up a Web3 startup program could have caused this upsurge.
The Solana Foundation is excited to support @Google with this program and onboard the next generation of web3 builders.
For eligibility requirements, check out the grants program and RFPs: https://t.co/6wlbICu9k9 https://t.co/P94ifq6ctT
— Solana Foundation (@SolanaFndn) April 25, 2023