By Brian Smith, President, Jito Foundation.
The intelligence layer for fintech professionals who think for themselves.
Primary source intelligence. Original analysis. Contributed pieces from the people defining the industry.
Trusted by professionals at JP Morgan, Coinbase, BlackRock, Klarna and more.
Join the FinTech Weekly Clarity Circle →
Solana’s ascension over the last three years was built in large part on raw speed. Going from being the butt of jokes at $8 per token in early 2023 to dominating multiple key metrics such as stablecoin transfer volume, trading volume, and tokenized equity adoption, Solana’s technical performance made for a compelling narrative with neat, measurable data points proving its competitive excellence. IBRL -- Increase Bandwidth, Reduce Latency -- was a rallying cry for the ecosystem that also served as a shorthand investment thesis for capital allocators and a pitch for developers looking for a chain to deploy their apps.
The results are inarguable: Solana is cemented as a top-3 Layer-1 ecosystem and frequently tapped when major institutional players roll out a new product or bring core services on chain.
However, speed alone has never been what makes financial markets work. As Solana turns to a new slogan (Internet Capital Markets), the chain likewise faces two new challenges. First, instead of competing primarily with Ethereum and its dozens of Layer 2 vassals, Solana now must contend with hyper-specialized chains tailored to dominate in particular markets, such as perpetual futures or stablecoins. Far more onerously, however, Solana’s ambitions to become the home of global finance means it must compete directly with legacy financial infrastructure, with the goal of eventually replacing it entirely.
If the game were simply to continue competing with Ethereum, Solana is all but guaranteed to win. To compete with Swift, NASDAQ, CME, ACH, and the other entities responsible for managing modern financial life? In order to achieve this, Solana must make core changes to its architecture -- specifically, to its blockbuilding.
Most people who interact with Solana (swapping tokens, accessing DeFi protocols, or trading derivatives onchain) never think about block building. They shouldn't have to. Block building is the mechanism that determines which transactions get included in each block, in what order, and under what conditions. It is the market microstructure of the blockchain -- a playground usually reserved for specialized trading shops and market makers.
For most of Solana's history, this infrastructure operated in the background with limited scrutiny. But as Solana attempts to credibly position itself as the home for all of global finance, these easy-to-ignore nuances must be the primary focus of the developer community. What’s at stake isn’t just token price going up or going down -- it’s deciding the home of potentially every digital transaction, from a credit card tap to a stock or bond sale, for every human on earth.
The Dark Forest
A block builder has discretion over timing, ordering, and inclusion, and when that discretion is both available and profitable, it tends to get exercised in ways that benefit whoever holds it. A builder who delays releasing block data while also controlling transaction ordering can determine whether a market maker's price update lands before or after an incoming trade, a decision worth a significant amount of money at scale.
Recent quantitative analysis across 2.82 million slots found measurable differences in block build times, oracle update positioning, and trading outcomes depending on the specific block builder. The critical distinction was not in typical conditions but in tail events: the rare, severe adverse-selection episodes that ultimately determine whether a venue is profitable to quote on. Markets that look fine on the median can be unworkable on the mean, and the mean is what matters economically.
Vertical Integration and the Trust Problem
The concern with vertical integration is straightforward: when one entity controls the transaction landing service, the block builder, and a proprietary trading operation simultaneously, the incentives to extract value from users become structural rather than incidental. Transparency helps, though only if the underlying code is open-source and independently verifiable. Commitments to open-source in the future are not the same as open-source today.
When market maker quote updates land at consistently different positions in the block depending on which builder is in control, and an affiliated trading operation benefits from those differences, the neutrality of the infrastructure is in question. Recent data suggests at least one such dynamic has self-corrected, which is encouraging. The structural question of how such situations are prevented, rather than corrected after the fact, remains open.
The Protocol Solution Is Coming, But Not Tomorrow
The long-term answer is protocol-level infrastructure. Solana's roadmap includes an architectural evolution that would distribute block production across multiple simultaneous validators, removing any single actor's ability to time or sequence transactions advantageously. That evolution depends on a next-generation consensus protocol targeted for 2027, putting full implementation twelve to eighteen months away. The network needs to make sound decisions in the interim.
What the Stakes Actually Are
Solana's institutional narrative has accelerated dramatically, with major financial institutions exploring onchain settlement and regulated exchanges evaluating Solana as infrastructure. Institutional adoption, however, requires institutional-grade execution guarantees. Without them, sophisticated market participants will route flow to venues where the rules are clearer and the risks are better bounded. The growth of purpose-built trading venues with tighter execution guarantees is the most visible evidence of that pressure.
Solana has the talent and the technical capability to compete on execution quality. Realizing that potential requires treating execution quality as a first-class infrastructure problem, not an afterthought. That means validators prioritizing network health over short-term revenue, builders choosing verifiability over opacity, and the broader community holding infrastructure operators accountable to the standards they claim to uphold.
The Question Worth Asking
The block-building debate is, at its core, a question about how ambitious Solana wants to be. The technical path toward better, more consistent execution is visible. The harder question is whether the ecosystem will coordinate around it before the window closes.
Speed got Solana to where it is. Execution quality is what will take it further.
About the author
Brian Smith is President of the Jito Foundation, where he oversees Jito's products and governance, including its liquid staking solution JitoSOL and verifiable blockbuilding infrastructure.
