Over time, the blockchain industry has continued to evolve and grow beyond the expectations of many. Notably, the continuous growth of the industry is occasioned by the increasing number of projects coming on blockchains. This, as revealed, has consequently enhanced the level of investments in the industry, thus causing healthy competition. Today, each of the existing blockchain service providers is evolving and improving on their offerings to attract more developers to their platforms. Additionally, some of these blockchains, like Solana and Ethereum, for instance, run to solve similar problems in the virtual sphere. This development has, over time, ignited a Solana vs Ethereum debate amidst developers and other end users.
Worth noting that both Solana and Ethereum enjoy remarkable patronages. They both avail high-performance blockchain supports to developers of dApp projects and protocols. Now the solana vs ethereum comparison will be done so as to discern the platform that offers the best services between the two. Certainly, this article will carefully assess functionalities (speed, security, scalability), projects, similarities, and differences to do the Solana vs Ethereum comparison.
Solana vs Ethereum: Overview
Indeed, doing the Solana vs Ethereum comparison necessitates the need to carefully review both blockchains. Apparently, both Ethereum and Solana are almost similar in terms of the problems they tend to solve. Reportedly, the Solana blockchain runs to avail a series of rapid transactional operations to developers and end-users. The platform possesses an outstanding bandwidth which accelerates and give consistency to every operation on the network. According to a Solana review, which conveyed a detailed description of the blockchain, it possesses the ability to process millions of transactions per second without hindrance.
Notably, Solana blockchain features a mechanism which help fasten the processing of about 710 thousand transactions per second, particularly on a normal gigabyte platform. As for a 40 gigabit standard, the blockchain run about 28.4 million transactions per second.
Notably, the blockchain utilizes a consensus mechanism, called Proof-Of-History (POH). Certainly, the POH fosters the speed of all transactions running on the network. More so, the proof-of-history further give a timestamp to every processed transactions and facilitates the verification of information rapidly. However, Solana usually experience fervent issues with its hardwares.
Transaction fees on Solana
Worth noting that the transaction fees incurred on Solana appears more cost-effective. Even moments when transaction costs of some other blockchains get hiked, Solana’s cost stayed unchanged and inexpensive. Accordingly, the transaction fees incurred on the net amount to an average of US$0.00025.
The low-cost incurable on Solana, as well as its complete visibility, facilitates the interests of investors on the blockchain. Coupled with its massive bandwidth, the Solana blockchain further enjoys over 5 million non-fungible tokens. As of now, it also possesses a massive value pegged into DeFi-based programmes and amounting to over US$11 billion. Despite the prospects attached to the network, its reliability is still questionable. This is because the blockchain had, on numerous occasions, become completely offline or gone down.
Solana’s native token
Just like others, Solana possesses a native token, SOL. This token helps to reward holders with governance right in the ecosystem. This means holders of SOL are usually involved in the network’s decision-making processes. More so, the token is usually deployed in paying for transactions done on the network. SOL enjoys a circulating supply of 350 million SOL coins and a total supply of 508 million.
To better analyze the Solana vs Ethereum debate, this piece will now do an overview on the latter. The Ethereum blockchain runs as a decentralized platform. It usually initiates a P2P platform which reliably and consistently implements smart contracts. With smart contracts, users become eligible to transact with one other without the presence of a centralized authority. Notably, all transaction details on the blockchain are distributed across the network in a secure, immutable, and verifiable manner.
Presently, Ethereum usually employs the proof-of-work mechanism. This mechanism, as designed, paves the way for developers to initiate projects that attempts to prove that an encrypted number is valid. However, the network is expected to migrate to proof-of-stake soon. This protocol tends to pave way for ETH holders to stake a certain amount of their ether.
Additionally, the migration to proof-of-stake enables users to validate transactions and mint new ETH. According to findings, the migration tends to add more capacity to the Ethereum network. Thereby, solving the problem of exorbitant gas fees owing to network congestion.
The development of ETH2.0
Termed Ethereum 2.0, the installation of the upgrade will be in several phases. Recall that the first phase, Beacon Chain became, launched in 2020. As of today, no date has been fixed for the unveiling of the second phase, identified as “the Merge.” However, emerging findings have proven that it might be coming to fruition later this year.
The last phase of the upgrade, known as shard chains, will help to spread operations across 64 new chains. However, all the effectiveness of the aforementioned developments appears unlikely until the full completion of the upgrade. The Ethereum foundation in recent times announced that the full Ethereum 2.0 tends to come into the limelight by 2023. Its full launching possesses the capacity to overwhelmingly grow the popularity of the blockchain and attract more developers and investors into the ecosystem.
Ethereum’s native token
Ethereum’s native token, Ether, helps to facilitate transactions on the blockchain. It reportedly serves as a payment instrument for the implementation of operations on Ethereum. With ether tokens, holders can send and receive value without any third-party interference. The total number of ETH coins in circulation stands at 121,903,357. The token possesses a market cap of over $205.504 billion.
Projects: Solana vs Cardano
In a bid to further initiate the Solana versus Ethereum comparison, it is necessary to highlight some of the distinctive projects running on them. As of today, there are thousands of projects running on the Solana and Ethereum blockchains. As for Solana, some of its projects include Parrot Protocol, Mango Market, Larix, Solfarm, Raydium, Serum DEX, solanart, Mercurial Finance, and many others.
Solana vs Ethereum: Similarities
On this comparison of Solana Vs Ethereum, there are existing similarities between these two. Though, it’s imperative to note that Solana developers created it to offer solutions to issues battling Ethereum.
Recall that there is an existing argument over the high gas fee and heavy workload on the Ethereum Blockchain. With Solana, cryptocurrency enthusiasts hoped the protocol would effectively tackle these issues. Despite the existing supposed rivalry, the two share certain similarities.
One significant attribute that is synonymous with the blockchains under review in the Solana Vs. Ethereum comparison is their embracement of DApps and NFTs. Ethereum and Solana offer a platform for DApps and NFTs initiatives to grow. Currently, the two protocols are playing host to numerous DApps and NFTs projects. Though we can’t refer to how several initiatives have developed Ethereum-Solana Bridges as similarities. Yet, it symbolizes the kind of relationship they share, which further underlines their compatibility.
Solana vs Ethereum: Differences
The centralization of the two blockchains has overshadowed other factors in the Solana Vs Ethereum Comparison. As a significant difference between the two ecosystems, in this aspect, Solana is more centralized than Ethereum. This is due to the consensus mechanism (POH) in which the protocol operates. As designed, Solana 30 of Solana’s prominent validators own about 35% of the overall stake. They staked thousands of Solana and influence a sizeable percentage of the network.
Though, the PoW and the PoH allow a group of people to have centralized authority over the block. Since the PoH operates within the PoS, validators get more power as they receive new tokens for their stake. Thus, making them get more richer and gain control which implants a kind of rigid concentration of power in this group of validators. In the PoW, Miners get rewards for protecting the blockchain. However, the competition of having fast computers to gain an advantage over other validators makes the Ethereum protocol more flexible than Solana. Still, through mining pools, validators form several groups that could have a centralized authority over the blockchain.
Solana vs Ethereum: Consensus mechanisms
Another prominent difference between these two is their consensus mechanism. Currently, Ethereum is yet to migrate to its 2.0 version, this implies that the current Ethereum will be regarded as a blockchain that uses the Proo-of-Work consensus mechanism. With the PoW, the blockchain becomes safeguarded by miners who use their supercomputers to validate transactions and create new blocks. The PoW provides more security but not fast enough to process transactions because it processes few per second. The processing power can be considered low due to the tremendous growth the ecosystem is witnessing daily.
On a different path, Solana uses the Proof-of-History, which underlines another significant difference in Solana Vs Ethereum comparison. The PoH needs a couple of computational activities to determine the cryptographical time between two occurrences. One can monitor an on-blockchain activity by adding timestamps to them. It’s widely known that Solana is more scalable than Ethereum. This is due to Solana’s stateless design. The PoH doesn’t require an update on the blockchain whenever there’s a new transaction. It allows transactions to take place sequentially, which makes it more scalable than Ethereum.
Solana vs Ethereum: Exposure to NFTs
A notable difference that differentiates the two blockchains under review in the Solana Vs Ethereum comparison is their exposure to NFTs. Notably, Solana is new and currently playing a catch-up game to Ethereum in the NFTs space. Ethereum is a prominent figure in the NFTs sector because it hosts significant collections. Recently, it has endured stern criticism due to the network congestion and high gas fee that disrupted the minting of the Otherdeed NFT collection this year. Also, Cryptokitties caused massive congestion on the Ethereum blockchain in 2017. At the moment, Solana seems to be doing well because of its scalability and power to process transactions faster. Solana doesn’t charge any transaction fee regarding NFTs, making its collections more accessible than Ethereum’s.
Furthermore, Ethereum has been in existence for a while compared to Solana. It has a more extensive ecosystem than DeFi ecosystem compared to Solana. Meanwhile, Solana is pulling strings via numerous initiatives to attract more DeFi projects to its platform. These initiatives have aided Solana in attracting more projects to its platform. So, developers see Solana as an effective alternative to Ethereum to build their DeFi projects. They prefer Ethereum first, but when they experience difficulties like congestion and high gas fee, they turn to Solana to seek refuge.
The transaction speed of Solana and Ethereum
There is also a vast difference in the transaction speed of Solana and Ethereum. Worth noting that Transaction speed also makes up a cogent part in the exciting contention of Solana Vs Ethereum. Solana appears well established as one of the fastest blockchains regarding the processing of transactions. The current version of Ethereum can process 30 transactions per second, while Solana will efficiently manage about 50,000 transactions per second. Though, fortunes will change for Ethereum in that regard when it fully launches its Ethereum 2.0. Then, the blockchain will have the structure to process 100,000 transactions per second.
Regarding Network size, Ethereum is the most extensive network that supports smart contracts. According to relevant data, as at last month, Ethereum’s total value locked sits at $53.21 billion, and Solana has about $2.54. In this section, the Ethereum size is about %95 bigger than Solana.
Solana vs Ethereum: Conclusion
In conclusion, Ethereum appears a way ahead of Solana in numerous ways. With the scalability and cheaper gas fees of Solana, the blockchain is gradually gaining popularity. Nevertheless, Ethereum will get an upgrade soon, pushing it above Solana in its shortfalls. One can’t deny the fact that Ethereum is well trusted and established than Solana, thus, making it a reliable protocol in the cryptocurrency space. The purpose of this piece on Solana Vs Ethereum comparison isn’t aimed at placing one above the other. Instead, the piece centered on analysis their respective strengths and weakness. Therefore, leaving enthusiasts and developer to utilize the one that best suits their ideology and structure.