Author: danny

When we talk about public chains in a bear market, what are we discussing? Is it price? Community? Or governance? At a more fundamental level, operating a public chain essentially means governing a digital nation. Tokens are currency, developers are citizens, DApps are industries, and on-chain governance is the government. If we re-examine the development history of Solana from a governance perspective, many seemingly accidental decisions have clear logic behind them.

Introduction: No one is born to be strong

On August 9, 1965, Lee Kuan Yew cried in front of the camera. Singapore was "kicked out" of the federation with Malaysia, becoming a small island nation without a hinterland, resources, or a military. No one believed it could survive.

On November 11, 2022, FTX filed for bankruptcy. Solana's TVL evaporated by over 75% in a week, and the price of SOL plummeted from $32 to $8. The consensus in the crypto circle was: "Solana is finished."

The beginnings of these two stories are strikingly similar: a small entity that has been abandoned, struggling to survive in a hostile environment. And the path they later took—from dependence, to grey survival, to transformation and upgrade—can almost be compared frame by frame.

This article is not aimed at discussing price or community, but rather a more fundamental question: operating a public chain essentially means governing a digital nation. Tokens are currency, developers are citizens, DApps are industries, and on-chain governance is the government. If we re-examine the development history of Solana from a governance perspective, many seemingly accidental decisions have clear logic behind them.

Chapter One: The British Military Era—The Umbrella of SBF and FTX

The British Military Economy in Singapore

In the early days of independence, one of Singapore's economic lifelines was the consumption and employment brought by the British military presence. The British military bases contributed about 20% of the GDP at that time. Singapore was well aware of the fragility of this dependence, but for a newly independent nation, it had no choice in customer selection. Survival was the top priority.

In 1968, the UK announced it would withdraw all troops east of the Suez Canal by 1971. For Singapore, this was akin to pulling the rug out from under them. But this "abandonment" forced Singapore to seriously consider: if the umbrella is gone, how will I survive?

The SBF Era of Solana (2020-2022)

The Solana mainnet launched in March 2020, but what truly allowed it to stand out among the numerous "Ethereum killers" was Sam Bankman-Fried and his empire. FTX and Alameda Research were not only the largest funders of the Solana ecosystem but also its credit endorsers. Early core projects in the ecosystem like Serum, Raydium, and Maps.me had significant involvement from FTX-related capital.

During this period, the Solana ecosystem resembled the Singapore of the British military era: outwardly prosperous, with good-looking data (TVL once exceeded $12 billion), but fundamentally fragile. A large portion of the on-chain activity came from Alameda's market-making funds circulating within the ecosystem; the real organic demand was far less healthy than the data suggested.

Just as Singapore depended on British military consumption, Solana relied on SBF's funding. The common characteristic of both was that the prosperity was real, but the source of the prosperity was external, centralized, and could vanish at any moment.

The Collapse of the Umbrella

In November 2022, FTX turned from the second-largest exchange in the world into a pile of ruins within 72 hours. The impact on Solana was systematic: the governance key of Serum was controlled by FTX, causing the project to collapse; the treasury assets of many ecosystem projects were frozen within FTX; the issue of SOL's staking concentration was laid bare; market confidence plummeted, and developers began to leave.

This was Solana’s "1968 moment." The umbrella was not gradually withdrawn; it was blown away in one night.

Chapter Two: How a Resource-less Small Country Survives—The Underlying Endowment of Solana

Singapore's "Only Resource": Geography

Singapore has no oil, no minerals, and even needs to import fresh water from Malaya. But it has something given by heaven: its strategic position at the Strait of Malacca. About 25% of global maritime trade passes through here. Lee Kuan Yew realized early on that he didn't need resources; he just needed to become the best node for resource circulation.

Solana's "Only Resource": Performance and Cabal

In the world of public chains, Solana also lacks the first-mover advantage of Ethereum, the narrative mythology of Bitcoin, and the modular flexibility of Cosmos. But it has one thing: extreme performance at the native level. A block time of 400 milliseconds, a theoretical peak of 65,000 TPS, and extremely low transaction fees (usually below $0.001).

This is not an optional technical parameter. Just as the geographic location of the Strait of Malacca determines Singapore's ability to become a trade hub, Solana's performance characteristics inherently make it suitable for hosting high-frequency, low-value, massive on-chain activities.

Geographic location to Singapore is analogous to block speed and transaction cost to Solana: this is its ticket to attracting cabals to participate competitively.

Chapter Three: Survival Wisdom in the Grey Area—from Laundering Port to Meme Casino

Singapore's "Less Glorious" Intermediate Phase

This is a period in Singapore's official narrative that is often downplayed. During the rapid development period from the 1970s to the 1990s, Singapore did not become a regional financial center solely based on its reputation for "integrity and efficiency."

A harsh reality was: during that era in Southeast Asia, neighboring countries—Indonesia's Suharto regime, the Marcos family in the Philippines, the military government in Myanmar—generated a large amount of funds that needed to be "cleaned." This money required a safe, non-interrogative, legally predictable place to dock. Singapore happened to provide such an environment: strict bank secrecy laws, efficient financial infrastructure, and a tacit attitude of "as long as you follow my rules, I won't investigate where your money comes from."

Commerce has no moral judgment, only survival strategies. A resource-less small country must accept some "imperfect money" in its early stages to accumulate enough capital stock for future transformation.

The key is that Singapore has never allowed itself to drift. While attracting funds, it has always maintained extremely high administrative efficiency and legal certainty (Temasek and GIC are among the top 10 sovereign funds in the world). You can bring in grey money, but you cannot cause chaos on my territory. This "ordered grey" is an incredibly delicate balance.

Solana's Meme Season and Pump.fun (2023-2024)

After the collapse of FTX, Solana faced survival pressures comparable to those of early independent Singapore. TVL depletion, developer exodus, narrative collapse. What it needed at this time was not "correct" growth, but "any form of" growth—survival first.

From the end of 2023 to 2024, the meme wave swept through Solana. The emergence of Pump.fun reduced the threshold for issuing memes to nearly zero: anyone could create a token in minutes, with no coding or auditing required. The wealth creation myths of memes like BONK, WIF, and BOME attracted a flood of speculative funds.

From the perspective of traditional finance or technical fundamentalism, this was a disaster. The Solana chain was filled with rug pulls, sniper bots, and countless worthless tokens. But if understood through the historical framework of Singapore, one finds striking similarities and reasonableness:

Just as grey money was important for early Singapore, memes represent grey funds for Solana—they may not take center stage at tech geek conventions, but they bring three key things:

• Capital Influx (Foreign Reserves): Meme trading generated massive on-chain transaction volumes and fee revenues, directly enriching the validator's economic model and stabilizing the network's basic operation.

• User Base (Population): Millions of new users first encountered the Solana wallet (Phantom's downloads skyrocketed during this period), even if they initially came for gambling.

• Infrastructure Stress Test (Urban Development): The extreme transaction loads during the meme peak exposed the real bottlenecks of the Solana network, prompting accelerated development of key infrastructure like the Firedancer client.

The wisdom of Singapore lies not in "accepting grey funds," but in "never stopping the construction of formal institutional infrastructure while accepting grey funds." Similarly, what matters for Solana is not the memes themselves but whether it advanced real valuable underlying construction under the cover of the meme frenzy.

Chapter Four: Currency Equals Sovereignty—The Governance Logic of Token Economics

Singapore's Monetary Policy Philosophy

The monetary policy of the Monetary Authority of Singapore (MAS) is unique among global central banks: it does not primarily rely on interest rates but regulates the economy by managing the exchange rate band of the Singapore dollar. The appreciation channel is used to curb inflation and attract capital; the devaluation channel is used to stimulate exports and maintain competitiveness.

The core logic is that currency is not static; it must be dynamic and responsive. How much money to print, whether to appreciate or depreciate the currency, depends on the current economic cycle's needs. Over-issuance can dilute national wealth and trigger inflation; excessive tightening can stifle economic vitality. Good monetary policy is a continuous balancing act.

The Token Economics of SOL: A Dynamic Game from Inflation to Deflation

Solana's token economics has also undergone a similar evolution.

Initial Inflation Phase (Quantitative Easing): When the Solana mainnet launched, it set about an 8% annual inflation rate, reducing at a rate of 15% per year, with a long-term target converging to 1.5%. These newly issued SOL are used to pay staking rewards, essentially a type of fiscal expenditure subsidizing validators—like emerging countries invest heavily in infrastructure early on; you must first incur costs to attract "citizens" (validators) to maintain network security.

Introduction of a Destruction Mechanism (Tightening Policy): In 2023, Solana introduced a partial destruction mechanism for transaction fees—50% of each transaction's base fee is permanently destroyed. When on-chain activity is sufficiently active, the amount of SOL destroyed may approach or even exceed the amount newly issued, putting SOL into a de facto deflationary state.

It's like a country's central bank finally having the ability to "raise interest rates": when the economy (on-chain activity) is prosperous enough, it can maintain currency value by reclaiming money supply.

But the problem is: Solana does not currently have a truly dynamic, responsive monetary policy framework. Its inflation rate mechanically decreases according to a pre-set curve, and the destruction rate entirely depends on market activity, with no "intelligent adjustment mechanism" like MAS.

This represents a deep governance issue that Solana (and nearly all public chains) have yet to solve: the issuance and destruction of tokens should not follow a fixed curve, but should dynamically adjust according to the network's "economic cycle," just as a sovereign nation's monetary policy does. During network congestion (economic overheating), the fee destruction ratio should be increased to curb speculation; during network lulls (economic recession), it may be necessary to lower validators' staking thresholds and increase incentives.

A truly mature public chain economy requires not a fixed inflation curve written into code but a set of on-chain "central bank" governance mechanisms.

Only a few understand that tokens do not only appreciate through destruction.

Chapter Five: Public Housing Politics—"Only Those Who Have Assets Will Protect the Country"

The Real Crisis of Early Nation-Building in Singapore: Not Poverty, but a Sense of Division Among Ethnic Groups

Most discussions of the Singapore miracle focus on economic growth. However, Lee Kuan Yew repeatedly emphasized that the most dangerous enemy during the early nation-building phase was not poverty but racial division.

In 1965, Chinese people made up about 75% of Singapore, Malays around 15%, and Indians about 7%. The three ethnic groups could not communicate, had different beliefs, and suspected each other. One of the triggers for Singapore being kicked out of the Malaysian federation was the irreconcilable ethnic conflicts between Chinese and Malays—23 people died, and hundreds were injured in the race riots of 1964.

After independence, Singapore faced a harsh reality: the people on this island did not consider themselves "Singaporeans." Chinese identified with Chinese culture, Malays with the Malay federation, and Indians with India. No one felt a sense of belonging to the concept of "Singapore," let alone a willingness to sacrifice for it.

The fundamental issue Lee Kuan Yew needed to solve was: how to make a group of distrustful individuals willingly live under the same roof and be willing to pay to maintain that roof?

Public Housing: Not Just a House, but a National Binding Mechanism

The answer was the HDB public housing program—possibly one of the most ingenious social engineering projects in human history.

On the surface, public housing addresses housing problems. In the 1960s, a large population in Singapore lived in slums and shantytowns. The government built public housing on a large scale and sold it to citizens at prices far below market rates, allowing the use of compulsory savings (CPF) to pay for mortgages. Today, over 80% of Singaporeans live in public housing.

But the true genius of public housing lies in the political logic behind it. Lee Kuan Yew once said a very frank remark (paraphrased): "A person owns assets in a place, and he will be more willing to defend it."

The public housing system achieved at least three strategic goals simultaneously:

First, it created "stakeholders." When you are merely a tenant, the city's rise and fall matter little to you—if things go bad, you can just move away. But when you own a home, your wealth becomes intertwined with the fate of this country. When property prices rise, your net worth rises; when the country is in chaos, your assets depreciate. Every public housing owner becomes a "shareholder" in Singapore's future.

Second, it enforced ethnic integration. This is the most underrated design of the public housing system. The HDB implements strict ethnic quotas (Ethnic Integration Policy): there are upper limits for the proportions of Chinese, Malays, and Indians in each public housing community, ensuring that no single ethnic group dominates. Your neighbors must be different from you. Children play together in the same block and attend the same school. After a generation, the physical mixing gradually dissolves racial barriers.

Third, it linked personal wealth to the quality of national governance. The appreciation of public housing relies on Singapore's continued prosperity and good governance. Good governance leads to better developments and facilities, increasing your house's value. This creates a powerful positive feedback loop: citizens have the motivation to support good governance because good governance directly enhances their asset value.

A public housing unit accomplished the triadic tasks of "binding interests—eliminating barriers—motivating governance." This is not just a housing policy but the cornerstone of the nation. To repel external threats, one must first stabilize internal conditions, a principle Lee Kuan Yew understood well.

Solana's "Racial Problem": A Divided Community

Shifting the view back to Solana. The Solana community after the collapse of FTX faced a level of division comparable to that of Singapore in 1965.

There are at least three "ethnic groups" on-chain, with drastically different interests:

Speculative traders and meme players. They are the largest contributors to Solana's on-chain activity, bringing transaction volume, fees, and topical relevance. However, they have no loyalty to Solana; they go wherever there is excitement and are essentially a floating population.

Native developers and builders. They have invested significant time and technical capital in building DeFi protocols, infrastructure tools, and DePIN projects on Solana. They both need (users and traffic) and resent (lowering the ecosystem's seriousness) the meme speculators, resulting in a delicate and tense relationship.

Validators and stakers. They are the backbone of network security, investing real hardware and staked capital. They care about network stability, staking yield, and the long-term value of SOL, showing no interest or involvement in short-term speculation.

The competitive tension between these three groups is divisive. Meme players complain that the priority queue for network congestion is unfair to retail investors; developers complain that memes steal all the attention and funding; validators complain that the MEV distribution mechanism is opaque. Without a mechanism to align the interests of these three parties, the centrifugal force within the Solana community will only grow stronger.

Where is Solana's "public housing"?

What insight does Lee Kuan Yew's wisdom—binding citizens with assets to their collective destiny—offer to Solana? There are already some mechanisms resembling "public housing" in the Solana ecosystem, but they are far from systematic:

The staking mechanism is the design closest to "public housing." When you stake SOL, you lock your assets in the network, and your returns directly depend on the network's health. Stakers naturally become "shareholders" in network security. But currently, staking in Solana is predominantly concentrated among large accounts and institutions, with ordinary users' participation rates and sense of involvement being insufficient—similar to if public housing were only sold to the wealthy, while the poor remained tenants, severely diminishing the effect of "interest binding."

Governance tokens and airdrops are a form of "house allocation." Ecosystem projects airdrop governance tokens (like JTO, JUP airdrops) to early users and developers, essentially "distributing assets"—turning participants from observers into stakeholders. The distribution of the JUP token from Jupiter reached nearly a million active wallets, rapidly creating a significant number of "owners" who felt a sense of belonging to the Jupiter protocol. If designed appropriately, this mechanism could be as effective as public housing.

The global community of Superteam DAO represents an attempt at "ethnic integration." Superteam has established localized communities in various countries, allowing developers from India, content creators from Turkey, and DeFi users from Nigeria to collaborate within the same organizational framework. This is somewhat like HDB's ethnic quota system—reducing cliques and factions through structured mixing.

However, what Solana still lacks is a truly systematic "asset binding—interest alignment" mechanism. Imagine a more refined version: if the Solana ecosystem could establish a system that allows developers to gain continuous protocol-level revenue sharing for successfully deployed applications; enables active users to accumulate some non-transferable "on-chain credit" or "citizenship" for long-term usage; and aligns validators' rewards with their reliability of service and contributions to decentralization—then the personal wealth of each participant would become tightly bound to Solana's overall prosperity.

When speculators, developers, and validators all become "owners" rather than just "tenants," they will truly be motivated to fight for the long-term interests of the chain. This is the deepest lesson Lee Kuan Yew taught us through the public housing program: people will not fight for abstract ideals but will fight fiercely for their own assets.

Chapter Six: The Crossroads of Transformation—"What Comes Next?"

Singapore's Three Leapfrogs

Singapore's economic transformation can be roughly divided into three stages:

The first stage (1960s-1970s): Labor-intensive manufacturing. Attracting multinational companies to set up factories using low-cost labor, earning foreign exchange, and solving employment. This is the "survival" stage.

The second stage (1980s-1990s): Financial and trading hub. Utilizing geographic and institutional advantages to become a regional capital gathering and shipping logistics center. Grey funds played an undeniable role in this phase. This is the "establishing a foothold" stage.

The third stage (2000s to present): Knowledge economy and high-end manufacturing. Heavily investing in education, attracting talent (Global Talent Program), and developing high-value industries such as biomedicine, semiconductor design, and fintech. Simultaneously tightening anti-money laundering regulations and gradually "whitening" the financial system. This is the "defining identity" stage.

Each leap was not a natural occurrence but an active transition to a new model before the profits of the old model were exhausted. This requires a strong strategic determination and political will—because transformation means voluntarily giving up part of current interests.

The Current Position of Solana: The Tail End of the Second Stage

If we use the Singapore framework for positioning, Solana is currently in the later stages of the second phase. The wave of memes continues to bring in funds and user dividends, but the marginal effects have begun to diminish. Market fatigue towards the "next hundred-fold meme" is rising, and if Solana fails to complete its transition before this wave of excitement fades, it risks becoming merely a "casino chain"—just as Singapore could have remained stuck in the grey finance phase, potentially becoming just another Cayman Islands.

What could be Solana's third stage?

I don't know either; it certainly won't be an AI agent.

Conclusion: The Fate of Public Chains is Ultimately the Fate of Governance

Looking back at the story of Singapore, its success was not due to good luck, but because at every critical juncture, it made counter-intuitive yet logical and common-sense decisions: opening up when it should (even accepting grey funds), implementing controls when necessary (enforcing strict laws to maintain order), and transforming when needed (even at the cost of current interests).

Solana stands at a similar crossroads. The meme frenzy provided it with the ammunition for survival and an active user base, but if it cannot accomplish three things before this wave of dividends wanes—establishing a dynamic token economic governance mechanism, achieving true decentralization to win institutional trust, and fostering core industrial ecosystems beyond memes—then it risks becoming a small nation that "almost succeeded" in historical terms, hesitating during the transformation window and ultimately being eliminated by time.

Competition among public chains can be viewed in the short term through narrative, in the medium term through technology, and in the long term through governance.

Tokens are not merely a price symbol; they are the currency of digital nations. And monetary policy has never been a fixed curve written in stone but an art of balance, timing, and restraint.

Postscript:

This article analyzes the Solana public chain ecosystem using the development trajectory of Singapore as a comparative framework, aiming to provide a new perspective on public chain governance. The historical narrative of Singapore has been simplified to serve the comparative logic and does not constitute a comprehensive evaluation of Singapore's policies.

Furthermore, can the same comparative framework be applied to other public chains? Sure, why not?

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