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It has been a dramatic bull run for Solana investors during the last month of August 2021. On Tuesday, August 31, the SOL price surged all the way hitting a new all-time high of $129 and becoming the eighth-largest cryptocurrency by market cap.
As Solana (SOL) makes way to the coveted ‘top ten crypto’ club, some hot discussions in the crypto space have erupted recently. Solana has been often touted as the Layer-1 competitor to the Ethereum blockchain.
We know the fact that Ethereum has a massive market share in hosting smart contracts, DApps, and DeFi. But then who doesn’t want to compete/compare with the best!
On Tuesday, Dan Held, head of growth at crypto exchange Kraken sparked the debate asking whether if Solana is a better smart contract platform than Ethereum.
Is Solana a better smart contract platform than Ethereum?
— Dan Held (@danheld) August 31, 2021
Well, there have been a number of responses to it. Replying to it, popular crypto analyst Willy Woo said:
The DeFi apps that run on it run a lot better. There’s a few videos on how SBF’s team chose Solana on their quest to build a DEX with proper order books (Serum). It technically wouldn’t be doable on ETH and still be usable; too slow and too expensive.
Picking Solana Over Ethereum
Here, Woo was referring to FTX exchange CEO, Sam Bankman-Fried (SBF), who dediced to launch a decentralized exchange (DEX) on Solana instead of Ethereum. SBF said that the major reason to select Solana over Ethereum was the better scalability. In a podcast interview back in May 2021, with The Scoop, SBF said:
“Any products that we tried to build or that even that we tried to scope out — we originally were just definitely going to build on Ethereum because that’s where everything was — product after product got into the same death knell which was 10 transactions a second for the network was just not enough”.
Note that SBF has also been a major investor in the Solana ecosystem. Using a combination of the Proof-of-History (PoH) and Proof-of-Stake (PoS), Solana promises much more scalability with its consensus mechanism. SBF said:
“Solana has gone down in the direction of saying, hey, look we want the performance of blockchain to be an important criteria of it and we care a lot about the efficiency and scaling and economics of it”.
Not to forget, Ethereum developers have been working hard to push the launch of Ethereum 2.0. The PoS Ethereum will significantly boost the network scalability making it difficult for its competitors.
The only thing is the delay in the launch of Ethereum 2.0. The crypto ecosystem with DApps and DeFi is expanding fast and thus new market players are moving towards platforms that are less costly, efficient, and more scalable.
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