Company: OSOL
Filing Date: 2025-10-22
Form Type: S-1
Source: 0001493152-25-018952
Chunk: 12

Company: Osprey Solana Trust
Filing Date: 2025-10-22
Form: S-1
Chunk 12
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 transactions aggregated into groups called blocks. By synchronizing on blocks, transactions on these blockchains cannot be processed until a duration of time (known as “block time”) has elapsed. On blockchains that use a Proof of Work consensus mechanism, these block times are approximately 10 minutes in order to minimize the probability of multiple Validators on that network producing a new valid block at the same time, and therefore avoid rolling back the operation of block production.

Blockchains that use a Proof of Stake consensus mechanism do not have this time constraint; however, without a reliable timestamp, a Validator in PoS cannot accurately determine the order of incoming blocks. Proof of Stake mechanisms such as Tendermint attach an externally referenced time marker (known as a “wallclock timestamp”) usually based on the number of seconds elapsed since 00:00:00 UTC January 1, 1970 (known as “Unix time”). Due to the limitations in the ability of most computers to maintain consistent measurement of time over long periods as well as network communication latencies, Validator wallclock timestamps can only be accurate within 1-2 hour spans. Due to time uncertainty PoS blockchains must accept limitations on transaction processing speed to minimize the probability of multiple valid blocks.

The Solana Network uses a Proof of History mechanism to remove time uncertainty and, along with other novel optimization technologies around forwarding and processing, increase Solana Network transaction processing speed relative to other blockchain technologies. As currently constituted, the Solana Network can achieve a maximum throughput of 710 thousand transactions per second with 400 millisecond latency per block on a 1 giga-bit per second network using current computer hardware. With greater network capacity, the Solana Network can scale to higher speeds s bandwidth is increased.

Using Proof of History, a Validator node that is chosen to lead a particular block propagation uses an algorithmically generated cryptographic proof that some duration of time has passed since the last proof. With this PoH timestamp, all data that has been hashed into the proof is proven to have occurred before the proof was generated. With the block already pre-validated due to the PoH timestamping, the node then shares the new block with other Validator nodes, which are then able to verify those proofs and vote using an adapted Practical Byzantine Fault Tolerance voting system to achieve consensus that this block should be added to the permanent Solana Blockchain.

Several U.S. regulators, including the Financial Crimes Enforcement Network of the U.S. Department of the Treasury (“FinCEN”), the Commodity Futures Trading Commission (“CFTC”),