DeFi Safety, an independent DeFi rating organization, has ranked Solana second worst on the company’s technical criteria.
Axe Infinity‘s, the popular play-to-earn gaming platform, the Ronin blockchain has been ranked as the worst according to DeFi Safety. Ronin was hacked for $600 million in March 2022.
The Montreal-based agency has evaluated over 240 decentralized finance (DeFi) protocols and 15 different blockchains.
DeFi Safety’s blockchain reviews include five different criteria: number of nodes and their diversity, supporting software, documentation, and testing and security blog entry.
“DeFi Safety Doesn’t Perform Code Audits” explained Defi Safety on its about page. “Instead, we review the quality of the process and documentation behind the code, of which audits are just a part.”
Why is Solana badly rated?
DeFi Safety’s main reasons for such a low rating revolve around Solana‘s poor node infrastructure and frequently downtime.
Other reasons include improper handling of archived node information, poorly designed block explorers, and unverified node clients (software) with less diversity than competing blockchains.
DeFi security To ponder about the lack of details regarding the network’s node archiving, or the process of storing all of a blockchain’s data since its inception.
4/28 It’s still unclear where the chain stores its history – there have been no documented updates on the solar bridge since the archives were abandoned. https://t.co/g9fW2Lvsfc
— DeFiSafety (@DefiSafety) June 7, 2022
There is no clear documentation on node archiving other than a year Reddit thread by Anatoly, co-founder of Solana, according to the rating agency. However, Austin Federa, head of communications at Solana, said that was not necessary for Solana.
“Solana doesn’t require knowledge back to genesis to validate a block,” Federa told Decrypt.
Regarding node customers, DeFi Safety argues that Solana simply doesn’t have enough offerings. A node client is software that helps users connect their computers to a blockchain network to validate and execute transactions.
Solana currently only offers one piece of software for its node operator, which has not been audited since 2019, claims DeFi security. Ethereum offers for example seven different execution clients and six consensus clients.
“Just a node implementation; this is accurate and valid,” said Federa. “The Solana Foundation is working to diversify Validator customers.”
According to the messageSolana’s native block explorer, Solscanalso leaves a lot to be desired, especially compared to that of Ethereum ether scan.
“Several top-notch block explorers are being built by the community, most of which are less than 18 months old,” Federa said decrypt. “During that time, their UX and functionality have evolved a lot improved to meet the needs of builders and users.”
The report too specified that some Solana validators had started censoring transactions. But Solana Labs also denied this, calling it synonymous with Miner Extractible Value (MEV) in Ethereum. MEV is any ancillary revenue a miner can earn beyond winning block rewards and earning gas fees by changing the order of transactions.
“The power in any network rests with the validators,” Federa told Decrypt. “This discussion [DeFi Safety] referred to was among several validators in the discord channel. The foundation has no power to censor transactions.”
“We agree with Solana that Solana does not censor transactions. However, it has been debated,” said Nick Sheaf, the co-author of the DeFi security report decrypt.
“Solana is impressive and fast and beautiful but boy could it be done better,” he concluded.
How reliable is the report?
The rating behind this report is based on the criteria established by DeFi Safety.
Notable DeFi protocols including Uniswap V3 (96%), joint financing (93%), Spirit (94%) and banker (96%) are rated highly for their improved transparency and security.
The rating project also gave Terras Anchor Finance a safer product rating (75%) than Solana, which collapsed due to the protocol’s architectural failure.
Defi Safety also published a report on Badger DAO as 99% safe in September 2021, which was later hacked in December 2021 for $120 million.
The main reason for the discrepancy is that the Defi Safety report is based on the project’s smart contracts. Instead, Badger Finance’s user interface was exploited.
Report on Badger Finance. Source: Defi Safety.
Price action by Solana
Solana (SOL), the ninth-largest cryptocurrency with a market cap of $13.8 billion, is up slightly over the past day, trading at $39.09.
SOL is still a whopping 85% below its all-time high of $260.06, recorded in November 2021, according to data from CoinMarketCap. In fact, many of the top cryptocurrencies have lost tremendous amounts of value since the market declined over the past year.
Total Value (TVL) on Solana is $3.77 billion, up 1.07% over the past 24 hours, according to data from deflame.
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