Cryptocurrencies
Solana’s Innovative Approach to Reducing On-Chain Storage Costs

Solana, a blockchain platform that has established itself as an industry leader due to its speed, low environmental impact, composability, and low gas fees, has announced a new technology that could significantly reduce the cost of on-chain storage.
The Cost-Cutting Competition
The technology, called state compression, allows data to be stored directly on-chain, drastically reducing the cost of minting 1 million NFTs on Solana to around $110. This is a promising development for Solana, as it further cements its position as the ideal platform for building scalable and user-first Web3 products.
State compression is already being used by various teams across the Solana ecosystem to power large, user-friendly experiences. Dialect, a blockchain-based messaging service, is using state compression for compressed NFTs to cover the minting cost of NFTs for thousands of users, while Crossmint, an NFT and API tooling company, is using state compression to create integrations that power deeper customer loyalty for companies worldwide.
Other projects such as user-owned wireless network Helium, NFT distributor DRiP, and on-chain publisher Wordcel are also using state compression to bring their scalable and user-friendly experiences to Solana.
State compression can be used to store any type of data on-chain, but its first application is compressed NFTs. Compressed NFTs are similar to regular NFTs but significantly cheaper. The cost of storing 100 million compressed NFTs on-chain is approximately $50, compared to $1.2mm for uncompressed NFTs. Moreover, the incremental cost of compressed NFTs is a mere modification of an existing tree, making the cost of an NFT on Solana as low as the cost of a single transaction ($0.000005).
State compression is built by developers at Solana Labs and Metaplex, powered by RPC providers and indexers Helius, Triton, and SimpleHash, and with support from Phantom, Solflare, and the Solana Foundation.
This compression-friendly data structure takes advantage of Merkle trees, allowing developers to store a small amount of data on-chain and update it directly in the Solana ledger, reducing data storage costs dramatically while still using Solana’s base layer’s security and decentralization.
In conclusion, Solana’s state compression technology offers an innovative and cost-effective solution for on-chain storage, making it even more attractive for developers to build scalable and user-friendly Web3 products.
With state compression already being adopted by various teams across the Solana ecosystem, it is clear that the future of Solana is bright, with more exciting developments and solutions to come.
The introduction of cost-cutting solutions like Solana’s state compression technology has the potential to disrupt the crypto industry by making it easier and more affordable for developers to build decentralized applications.
With more cost-effective solutions available, developers may be more likely to choose platforms like Solana over other competitors, leading to increased competition and innovation in the industry. Additionally, cost-cutting solutions may also make it easier for smaller developers and startups to enter the space, increasing competition and driving growth in the industry.
As the crypto industry continues to evolve, cost-cutting solutions like state compression will play an increasingly important role in driving innovation and competition.
