Ethereum under pressure: Why Solana could beat Ethereum
2 min readEthereum is the (still) undisputed number two in the crypto universe. The crypto project has made itself comfortable right behind Bitcoin for years and is quite willing to take the throne itself. The price of ETH is currently around 3,000 USD and the market capitalization is around 340 billion USD. But Ethereum would do well to take a look backwards. Because the competition never sleeps. First and foremost is Solana, the current number 5 in the crypto rankings.
The blockchain has long been considered an ETH killer and the network is slowly trying to live up to this title. Especially when it comes to meme coins. Since the sensational success of BONK in December 2023, more and more meme coin projects are choosing Solana instead of ETH Probably also because every new Solana meme coin ends up in the upper echelons of the trending charts with sleepwalking certainty. The SOL, Solana’s native token, is currently trading at around 100 USD and has a market capitalization of 45 billion USD.
Solana vs Ethereum
Ethereum is the dominant blockchain when it comes to smart contracts and dApps. The blockchain was the first of its kind, which enabled the platform to build up a correspondingly large user group. ETH is stable and reliable and, unlike Bitcoin, which is merely a means of payment and speculation, ETH is the fuel and heart of the ETH ecosystem. The biggest criticism of ETH is the gas fees, which can skyrocket due to scaling issues.
By switching from the Proof-of-Work consensus mechanism to the Proof of Stake consensus mechanism, ETH, headed by crypto rock star Vitalik Buterin, wants to get this problem under control. Speed and scalability are Solana’s strengths, but stability is not.The blockchain is able to process up to 65,000 transactions per second; for ETH it is currently 15. The gas fees are correspondingly low.
With the Firedancer update, up to 1 million transactions per second should be possible. However, Solana is also known as the blockchain that often struggles with network outages, most recently in February of this year. Solana has failed a total of eleven times in recent years and these failures sometimes lasted several hours (the record is 17 hours, which is how long the network was down in September 2021). With Firedancer these problems should also be solved
