TO BE AN ETH OR SOL MAXI?
Unlike other networks, the co-existence of Solana and Ethereum has always been almost impossible to achieve. Researchers and users of the network has always seen to be comparison of both. While some are of the belief that the comparison is almost inevitable since Solana was created to solve the shortcomings of Ethereum. Regardless, there has been a remarkable growth to Solana, most are concerned if Solana will actually live up to the reputation, ‘’Ethereum killer”.
The argument is mostly based on if Solana has been able to achieve its purpose or that while trying to focus on being the solution of Ethereum failed to pay attention to the issues that could arise from the network itself.
Both coins shall be compared under essential elements important to the proper operation of any cryptocurrency:
SECURITY
Cryprocurrency operated on blockchain technology which is believed to be to be the most secure way of storing records, transactions, assets etc. This has helped to fuel the adoption of cryptocurrency. How has both networks handled the security of assets on their network?
Ethereum operates on a Proof-of work mechanism. This involves the use of miners who use computerized power to validate transactions. This removes the issue of centralization, as several independent persons or bodies are in charge of running the network. Also, there are thousands of validators, alongside hundreds of decentralized apps all running on the network. This together with the proof of work mechanism employed has helped to make Ethereum a very secure network, and free from the risks of centralized power.
Solana operates on a proof-of-history and proof-of-stake mechanism. The proof of history provides for significant speed in transaction process at the expense of verification processes. Verification processes are reduced and curtailed to enhance the transaction speed. Subsequently, Solana has only a few hundred validators and fewer decentralized apps running on the network, where the top validators holds over 35% of the total stake, power is still not completely decentralized and these stakeholders can still exercise control over the network and if one day decides to come together to stop the network can almost be a success. This does not provide enough credibility from Solana or security of funds of users.
Asides the $50 million funds stolen by anonymous hacker in 2016, since Ethereum is mostly decentralized, it is mostly never down, however Solana has witnessed some major downtimes within the short period of its operation. The first one happened in December 2020which lasted for 5 hours, the second major downtime happened September 2021 and lasted for 17 hours caused by a Distributed denial of service attack (DDOS). Although, there has been no record of loss of funds or assets during these attacks. Minor outages are also frequent issues on the Solana network, this has made people question the security and effectiveness of the network.
TRANSACTION SPEED
Solana has gained reputation for being the fastest network, with the ability to run up to not less than 50,000TPS within seconds. This is possible due to the mechanism Solana operates on, the entire network does not need to be updated for every transaction to be carried out. In January 2022, where there was an overload on the network and led to outages, there were reports saying the Solana TPS reached as high as 400,000. While some users were disappointed for yet another outage, some were marveled at the ability of Solana to reach 400,000 TPS
However, this seems to be an issue with Ethereum which struggles with 30TPS per 15 seconds. While some users have attributed this to the fact that the major focus of Ethereum is decentralization and security, some other users have voiced out their complaint. The constant lags during Ethereum transactions sometimes lead to overcongestion on the network which is not the best of experience for users.
TRANSACTION COST AND EASE
One other notable feature of Solana is the very low transaction fee, transaction fee is as low as 0.000014$. This is not the case in Ethereum where the least a person can pay for gas is 0.09$, the overcongestion on ethereum does not help cases either. Transaction fees, also known as gas fees can go as high as 100$. This is referred to as the gas wars, users of the network have often expressed their displeasure over this.
While both networks run smart contracts, they make use of different programming language. Ethereum makes use of Ethereum Virtual Machine (EVM) written primarily in custom language. Solana makes use of C, C++ and Rust which happens to be the favorite of developers. Hence, Solana has a more user friendly interface, a new user almost does not need a guide to make transactions on Solana. Unlike Solana, ethereum requires more and longer processes to make transactions.
DECENTRALIZED FINANCE (DeFi)
Decentralized finance is an alternative to the traditional banking, where complete power in transactions solely lie in contracting parties without a third controlling or regulating body Decentralized finance make use of cryptocurrency and Ethereum network is rapidly becoming the home of Defi.
The high security offered by the network, alongside its highly operational smart contract has allowed for the launch of various decentralized finances on the network. Examples include, AAVE, sushiswap, Uniswap, Curve, Lido amongst other notable defi platforms launched on the network.
Despite, the high transaction speed and low transaction fees offered by the Solana network, launch of decentralized finance platform is still significantly lower than that of Ethereum. A lot of development have not been made to Solana in terms of defi, there are still very few number of validators. Decentralized finance platform launched on the network are just as few, the notable ones are Raydium, Serum and Orca. Decentralized finance is a very integral part of cryptocurrency, hence one of the reasons why Ethereum has more users than Solana.
NFTs
Non-Fungible tokens are rapidly becoming a trend, its irreplicable feature has made it to be utilized in different sectors, entertainment, fashion, real estate, etc. Although, NFTs were not first launched on Ethereum, the network has hugely contributed to its prominence. NFTs such as Punks, Otherside and Bored Ape Yacht Club which hit over $1.2 billion dollars in volume of primary and secondary sales were all launched on the Ethereum network.
Solana NFTs have not be doing badly either, with the launch of Degenerated Apes which had over $10 million trading volume, the network welcomed a large number of NFT enthusiasts.The prominence of Solana NFTs continued to skyrocket, Opensea, Ethereum’s lead marketplace started to trade Solana NFTs. There was the launch of projects like Okay Bears and Tripping Ape Tribe that assumed number 1 spot for in all marketplaces including Opensea. This brought a huge euphoria and bullish runs to Solana NFT community.
Generally, Opensea surpasses any other NFT marketplace in trading volume, however, there were months where Magic Eden, Solana lead NFT marketplace surpassed Opensea in trading volume. Recently, Opensea diversified from trading to being a launchpad for NFT projects in which some NFTS on the Solana network launched with the platform. Also, newer NFT projects are adopting a cross network mint, where users could mint in both Ether(ETH) and SOL.
It is no longer news that the gap between Solana and Ethereum NFTS keeps getting bridged.
The above analysis of Ethereum is on the present situation of the network, which is soon to become more advanced with the news of the incoming Ethereum 2.0 known as the merge. What is the Ethereum merge?
THE MERGE
The news of the merge has been ongoing for a while, but it seems it will not be for much longer before it is operational. The merge will be an advancement to the present situation on the Ethereum network. This includes a shift from the proof-of-work mechanism to the proof-of-stake mechanism, asides from the complaint from users about POW being slow and causing lagging transactions, it has also been discovered that the POW mechanism consumes a lot of energy in its operation, energy almost as big as a country, Pakistan, this undoubtedly also poses a threat to climate change. The merge is also to make an effect to the speed of transactions allowing the network to run as high as 100,000TPS, although no changes shall be made to the cost of transactions.
There have been few concerns over the new mechanism to be adopted; if it will not lead to a less decentralized system and a halt of the network if stakers decide to cooperate. Ethereum’s founder, Vitalik Buterin has addressed issue saying that the cooperation of stakers is not enough to completely halt the network and if at all that happens, it will happen only once as immediately the attack happens, the stakers get slashed and have all their coins taken away.
Nevertheless, majority of the ethereum community is excited about the merge.
CONCLUSION
The competition seem to be really stiff, with each coin excelling exceedingly in their strength, makes it really hard to determine which will out do which. However, with the Ethereum merge coming up, the prominence of the strength of Solana may just be shortlived. Regardless, Solana will be leading in terms of low transaction cost, with the tremendous growth Solana has witnessed over the year, a 12,000% increase within the 2 years, Solana may just be the coin to watch out for.
Veteran cryptocurrency, Ethereum has established trust in the cryptocurrency space after surviving two bear markets. Ethereum has also been the foundation of some researches in blockchain technology.
Frankly, the choice of which coin to go with largely lies on preference and the future. Solana shows huge prospects of development and working out its shortcomings which may be due to the infancy of the coin while Ethereum has shown strong resistance over time . Both coins have pro-active teams ready to swing into action and are invested in the success of their products.
While the case of choice might still look dicey or unclear for some, one thing clear is that diversification has never been a mistake. Both coins have very huge potentials, why not go for both?
New to trading? Try crypto trading bots or copy trading
