Solana and Ethereum have been in competition for months now. Solana’s network offers solutions to all the issues faced by developers on Ethereum. Solana offers low transaction fees and high speeds, which have made it one of the preferred blockchain technologies.
Because of Solana’s efficiency and low latency, various DeFi projects have migrated from Ethereum and are now exploring Solana. One of the most notable projects that recently migrated from Ethereum to Solana is Power Ledger. Because of this fast-rising adoption, Solana has become a major competitor to Ethereum, and SOL tokens have rapidly been gaining in value.
Solana uses a Proof-of-History (PoH) framework that gives the platform scalability. The platform can process up to 65,000 transactions per second, significantly faster than Ethereum’s processing speeds.
Solana Ranks Seventh in Crypto Market Cap
Over the past month, cryptocurrencies have been gaining in value, and among the best gainers during this period has been Solana. The coin’s value has increased six-fold over the past month. According to data from Coingecko, Solana is currently trading at $182.94, with a market cap of over $52 billion. The coin has managed to outrank Dogecoin and currently ranks seventh in the market cap.
Before the market started making an uptrend in late July, Solana was trading at around $30. Hence, the current value represents an over 400% gain in just a month. The boom in Solana’s prices has been witnessed even as the broader market faces resistance with regular bearish trends.
The uptrend has mainly been attributed to buyer support, with most traders buying because of the incredible price action. With a market cap of around $53 billion, Solana is edging closer towards surpassing other coins such as XRP, which has a market cap of $60 billion. This will inch Solana closer to battling with Ethereum to become the largest altcoin in terms of market capitalisation.
Ethereum Shows Strong Resilience
Despite the gains made by Solana overshadowing all other gains that other cryptocurrencies have made in the past month, it is hard to miss the incredible performance that Ethereum has also shown. Ethereum’s value doubled since the market rebound kicked in, and the coin is around $500 short of reclaiming its all-time high of $4300.
In August, Ethereum launched the London hard fork upgrade, whose purpose was to launch token burning on the Ethereum blockchain to reduce supply. The decreasing supply of Ethereum since the token burning was introduced has allowed the coin to make significant gains. Coupled with market and buyer support, token burning has enabled Ethereum to retest the $4000 levels.
The London Hard Fork upgrade is among the proposals put forward by Ethereum developers to help realise ETH 2.0. The ETH 2.0 upgrade is expected to happen next year, and it is aimed to bring scalability to the Ethereum network by lowering transaction fees and making transactions faster. Ethereum also plans to shift to a proof-of-stake mechanism, which will also change how ether tokens are mined. The upgrade will place Ethereum in a better position to compete with Solana.
Despite Solana’s scalable blockchain, Ethereum still carries the largest portion of the DeFi market. Hence, for Solana to surpass Ethereum’s market cap of around $441 billion, the coin must increase adoption, which could take time. However, the only advantage Ethereum has over Solana is being the first in the market, hence with time, Solana will most likely surpass Ethereum.