Solana vs. Ethereum: Which Blockchain Is Better?

Solana and Ethereum: A Comparison

Solana and Ethereum are two of the most popular blockchains in the non-fungible token (NFT) and DeFi industries. Both projects have a large ecosystem and their own features that have attracted an audience to them. At the same time, Solana and Ethereum are direct competitors. Therefore, many participants in the crypto community are interested in which of the blockchains is better. The editors of BeInCrypto decided to look into the matter. To do this, we compared Solana with Ethereum and drew conclusions about which blockchain is better.


What is Ethereum

Project Launch

The first block in the Ethereum blockchain was mined on July 30, 2015. After the DAO project was hacked in 2016, the developers carried out a hard fork. The original network continued to operate under the name Ethereum Classic (ETC). Therefore, technically, the Ethereum known to everyone today is a fork of the original project.



Native Token

Ethereum (ETH). Market capitalization is $212 billion. The emission is unlimited. With the transition to the PoS algorithm, a deflation mechanism will be integrated into the project system.

Development Team

Vitalik Buterin, Gavin Wood, Anthony Di Lorio, Joseph Lubin.

Algorithm

Originally – Proof-of-Work (PoW). Over time, the developers decided to transfer Ethereum to Proof-of-Stake (PoS). Ethereum Classic, however, will continue to operate on PoW.

Current Network Size

$34.63 billion (95% larger than Solana).

Ethereum is the first programmable blockchain that allows developers to build decentralized applications (dApps) using smart contract technology.

Unfortunately, as the project grew in popularity, its network could no longer cope with the load. As a result, users of Ethereum and platforms built on the ETH blockchain faced increased fees. The overloads also caused the network to slow down.

The problem of low throughput of Ethereum was partially helped bypass the solutions of the second level (L2). To eliminate the problems at the root, the developers worked out a plan to migrate the project network from the extremely energy-consuming PoW to the more environmentally friendly PoS algorithm.

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What is Solana


Project Launch

The project release is dated April 2019, and the launch is March 2020.

Native Token

Solana (SOL). Market cap: $13 billion. Unlimited supply.

Development Team

Anatoly Yakovenko from Solana Labs.

Algorithm

Proof-of-History (PoH).

Current Network Size

$1.44 billion (95% smaller than Ethereum).

Solana is the answer to Ethereum's scalability problems. To overcome the difficulties faced by ETH users, the project team proposed a next-generation programmable blockchain.

Comparing Ethereum and Solana

To understand which blockchain is better: Ethereum or Solana, you need to pay attention to the technical features of both projects.

Algorithm

Blockchains operate on different algorithms: Ethereum operates on PoW (in the future, on PoS), and Solana operates on PoH. Let's look at all three options.

PoW

Pros: High security and stability. PoW allows miners to earn rewards for verifying transactions on the blockchain, which encourages people to help verify blocks, ensuring the smooth operation of the network.

Disadvantages: High entry cost for miners. High energy consumption. Slow network speed, which makes PoW unsuitable for organizing a universal settlement system. At the same time, the algorithm is perfect for such savings tools as Bitcoin.

PoS

Pros: Good energy efficiency and scalability. PoS is significantly faster than PoW and is more suitable for organizing universal payment systems.

Disadvantages: The transition from PoW to PoS may be associated with an increase in the centralization of the project due to the change in the coin mining mechanism from classic mining to staking.

PoH

Advantages: The technical features of the algorithm allow for lower network fees, making PoH the best option of the three for organizing universal payment systems. The algorithm also outperforms its competitors in terms of scalability.

Disadvantages: Because a small group of validators verifies network transactions, PoH is prone to centralization. In June 2022, analysts from DeFiSafety named Solana's PoH blockchain one of the worst due to the network's many technical issues. For example, in September 2021, the system was down for 17 hours due to a DDoS attack.

 Read more Soulbound Tokens (SBT)

Conclusions

It turns out that the PoS algorithm is more reliable, and PoH is faster and cheaper. Both algorithms have problems with excessive centralization. At the same time, Solana is more centralized than Ethereum. The top 30 validators of Solana control over 35% of the total stake.

Other Technical Specifications

Solana programming languages are more widespread.

It is also worth paying attention to the speed of block formation. Solana's indicator is 0.4 seconds, with a size of 20 thousand transactions. Formation of a block in the Ethereum network takes about 13-14 seconds, with a size of 70 transactions. As part of the move to PoS, the speed will increase to 12 seconds. Even after migration to another algorithm, Ethereum will not catch up with Solana in speed.

Which is Better: Solana or Ethereum

Ethereum is more reliable and efficient, but more expensive. The blockchain is inferior to its competitor in speed. Solana is cheaper. At the same time, the project is less stable and more centralized than its competitor. In addition, Ethereum is many times larger than its competitor in terms of the scale of the ecosystem.

The choice between Solana and Ethereum should be made based on what goals you want to achieve. Those who are ready to sacrifice speed and money for the sake of stability will be suitable for ETH. Users for whom the main criterion for choosing is speed should pay attention to Solana.