Ethereum vs Solana

Ethereum has long made for an excellent alternative to Bitcoin, being one of the investors’ top choices. But the market is changing at a rapid pace – not to mention the number of digital currencies that have emerged lately. Among these relatively recently launched cryptos is Solana, the blockchain platform that has managed to stand out in the vast sea of virtual currencies out there. At the moment of writing, Solana is the 11th cryptocurrency by market cap, along with big names such as Dogecoin, Polygon, and Polkadot.

Without a doubt, Ethereum and Solana are both popular blockchains. But although they’re built based on similar principles, there are some noteworthy differences between them that anyone venturing into the investing journey should know. For example, Solana was developed to improve upon Ethereum. And if we’re to allude to all the changes it has brought in, we can assume that’s true. The platform has improved upon the high transaction fees and low speeds that have long been problematic for users.

Nevertheless, Ethereum remains the most viable solution in terms of users and use cases, and it will most likely improve its transaction costs and speeds due to the upgrade entitled ‘the Merge’ that took place last year. So, if you want to invest in this crypto phenomenon, we can’t blame you. However, we recommend thoroughly documenting how to buy Ethereum, and this is also valid for Solana or any other crypto that might have grabbed your attention. Research is the answer, so let us shed some light on the critical aspects of the two projects so that you gain a clearer picture of these investment options.

What is Ethereum?

Ethereum is the first second-generation digital currency and the first to bring smart contracts into the blockchain industry. Smart contracts have contributed highly to the platform’s functionality, making it more scalable, secure, and faster. Besides, Ethereum is the world’s largest DeFi and dApp ecosystem, with thousands of developers building applications of all kinds here. However, remember that Ethereum is not a cryptocurrency itself, as many would rush to assume. Ether is but the token used to fuel the Ethereum network, often associated with the so-called ‘gas fees’ that users must pay to perform their activities on the platform.

PoS

Proof-of-Stake (PoS) is Ethereum’s new consensus mechanism after the Merge. Until now, it used the Proof-of-Work (PoW) model, and while this algorithm provides incredible security (it’s the essence of decentralization, after all), it consumes a lot of energy. Now, with a PoS model running, the platform is believed to become more sustainable and improve its overall performance. This is discouraging for miners, though, as they’re no longer allowed to mine Ether – staking is the new way of doing things.

Smart contracts

Smart contracts are a critical feature of the Ethereum blockchain, something that might outshine Solana or other blockchain platforms out there. These are pieces of code developed with the help of Solidity, Ethereum’s base programming language, and aim to help the parties involved in a transaction execute operations more smoothly.

NFTs

Besides dApps, Ethereum can also be used to create non-fungible tokens (NFTs). This is, indeed, no longer characteristic of Ethereum but of dozens of other platforms as well. But Ethereum remains one of the leading networks in developing such assets and one of the most relevant protocols to promote them.

What is Solana?

Solana was launched in 2020 to improve on many of the downsides of Ethereum. The platform aims to enhance transaction speed and scalability, and due to the advanced technology underlying it, it managed to reach these goals. Solana is considered one of the fastest-evolving ecosystems globally, with an impressive number of projects involving, among others, Web3, NFTs, and DeFi. One of the main upsides of Solana is that it automates the transaction ordering process, making high TPS rates more reachable. Plus, it’s an open-source project that allows third-party developers to design apps using the network’s infrastructure.

PoH

Solana’s consensus mechanism is the one thing that sets the network apart. Proof-of-History (PoH) leverages a timestamp system that can prove an event on the blockchain has occurred at a specific moment in time. This algorithm relies on a cryptographically secure function allowing safer, faster, and more scalable transactions. It may help to know Solana can support about 3400 transactions per second, which is quite impressive compared with Ethereum’s 15 TPS. Moreover, the mechanism ensures participants earn rewards for acting as validators. These validators are selected randomly, but you should know the top token holders are typically going in.

Enhanced scalability

Solana is known as one of the fastest blockchains, but the reason for this is often omitted. Well, it’s because of the platform’s ‘stateless’ architecture, designed to reduce memory consumption. Therefore, Solana’s state doesn’t need regular updates for each performed transaction, which further enhances transaction speeds. One might even assume that Solana benefits from Ethereum’s network, but the truth is that both networks have their own advantages and disadvantages. In other words, Ethereum is not better than Solana, and Solana is not better than Ethereum.

The SOL coins

Solana’s native token, SOL, has gained a lot of ground lately, and its current value of about $22 is clear proof of this. Those interested in SOL can stake the token and gain passive income. Experts say Solana could be an excellent addition to your holdings, as it’s expected to reach new highs and be more adopted in the foreseeable future.