Solana quickly rose to become a major player in the world of cryptocurrency during 2021, with its peak value rising to 3,700%. What drove so much attention towards Solana was its promise of unprecedented utility; it stood as a direct threat to Ethereum’s blockchain network which has long held its ground as the go-to destination for developers wanting to launch Decentralized Finance (DeFi) projects and applications. Could Solana eventually overtake Ethereum as the go-to network for decentralized finance (DeFi) projects and applications? Yes, it’s possible and let’s see why. To efficiently trade Bitcoin, you must use a reliable trading platform such as Immediate Edge bot.
Why Solana can overtake Ethereum?
When compared with Ethereum, Solana offers just one crucial benefit: there’s no waiting time between completing a transaction and verifying it on the blockchain. Although Solana transactions are approved immediately, Ethereum’s waiting period typically spans nearly four minutes. Solana is a more earth-friendly alternative when compared with Ethereum’s gas-consuming blockchain since transactions take much less time to process.
This helps make SOL a much more effective blockchain compared to Ethereum. Both NFT makers, as well as customers, are enthralled by the popularity of quicker transaction times plus more responsive markets, which have had a substantial part of Solana surpassing Ethereum in the very first round of NFT trading volume in May 2022.
Solana is Gaining Momentum over Ethereum
Yet another significant element driving Solana’s argument for surpassing Ethereum would be the scale of excitement created by the network and its official cryptocurrency, SOL. After its launch on August 1st, 2020, the price of Solana (SOL) skyrocketed 428.32% in five weeks and ended November 2021 with an impressive market capitalization of $63 billion — pushing it into the top 10 by market cap. This surge highlighted investors’ trust in its underlying technical framework, even though SOL has experienced bumps along the road since then. When a new bull market emerges, many believe that some of that momentum could shift from Ethereum to Solana again due to improved performance and more innovative features.
Innovative Proof-of-History Consensus
The historical opinion of Solana is top quality in the cryptocurrency space, and the method has gained the network lots of fans from all over the world. This’s since a lot of programmable blockchains, such as Ethereum, rely on external applications to put in a median timestamp to transaction data to confirm them in the order where they had been sent out.
Solana articulates that having centralized components in a decentralized entity raises questions about the system’s integrity. To combat this, they implemented their revolutionary Proof-of-History consensus which uses a variable delay function (VDF) to timestamp transactions into the blockchain itself.
Solana is gaining traction with its catchy tagline of “Web3 infrastructure for everyone”, and the development of such a formidable platform in 2020 demonstrates this. So far, it has seen 21 million NFTs minted on its blockchain as well as an impressive 125 billion transactions completed. These numbers prove that Solana could be at the forefront of what will become the next generation of internet technology.
Minimal Transaction Fees
Because of the gas-hungry dynamics of Ethereum, processing transactions in its crowded community calls for expensive costs which could fluctuate towards more than USD hundred a transaction. Additionally, the transaction might set buyers back up to $ 250, concerning the quantity of NFTs they purchase. The greater complicated a transaction is on the Ethereum blockchain, the costlier it’ll be.
As Ethereum 2.0 was released and the cryptocurrency ecosystem stabilized in 2022, gas fees for transactions on Ethereum have dropped significantly; yet they remain much higher than Solana’s $0.00025 cost per transaction. Having such low costs enables NFT collectors to invest in the artworks or collectables of their choice without having to worry about incurring extra fees due to expensive transactions.