Crypto World Changes: Solana vs. Ethereum
The world of cryptocurrencies is changing fast. Two big players, Solana and Ethereum, are leading the way. A big investment company, Franklin Templeton, recently told us about the growing competition between these two in the world of decentralized finance (DeFi). Let’s find out what makes them different and how they’re changing the crypto market.
Meet Solana and Ethereum
Solana: Fast and Cheap
Solana was started in 2020 by Anatoly Yakovenko. It’s famous for being very fast and having low fees. It uses a special way to agree on things called Proof of History (PoH) along with Proof-of-Stake (PoS), letting it handle over 4,000 transactions in a second[2][3]! This makes Solana great for things like quick trading and games. It’s also popular for launching meme coins because it’s so cheap to use[2].
Ethereum: The Original Smart Contracts
Ethereum was created by Vitalik Buterin in 2015. It’s the first place for smart contracts and apps that run on the blockchain (dApps). It has a big ecosystem with lots of developers and big companies using it, making it the backbone of DeFi and NFTs[1][3]. But, Ethereum has problems with handling lots of things at once and high fees, which it’s trying to fix with upgrades[1][3].
Solana Gains Ground in the Market
DeFi: A New Leader?
Franklin Templeton says that Solana’s DeFi volume is now bigger than Ethereum’s and all Ethereum Virtual Machine (EVM)-based DEXs combined, as of January 2025[4]. This is a big change, because Ethereum has always been the leader in DeFi. The top DeFi projects on Solana are growing fast and seem to be worth less than Ethereum’s projects[4].
Fees and Money
Solana also makes more money from fees than Ethereum in early 2025. In January, Solana made nearly $250 million, and in February, it made over $80 million[2]. This shows that more people are using the Solana network.
Problems and Opportunities
Solana’s Challenges
Even though Solana is growing, it has some problems. It’s expensive to run a node on Solana, which means fewer people do it, making it less decentralized[1][3]. Also, Solana has had some outages that affect how reliable it is[3].
Ethereum’s Strengths
Ethereum’s big ecosystem and security make it a safer choice. It has lots of big company support and is always being improved, keeping it a leader in crypto[1][3]. But, Ethereum’s problems with handling lots of things at once and high fees are still big challenges[1][3].
A New Time for Crypto
The change Franklin Templeton told us about means a new time for DeFi, where fast chains like Solana are challenging Ethereum’s leading role. While Ethereum is still the best for security and being mature, Solana’s speed and low fees are attracting more people. As the crypto world keeps changing, both blockchains will be important, offering different good things for people who invest and develop in crypto.
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Sources:
– tokentax.co
– nasdaq.com
– benzinga.com
– bitcoinist.com
– barchart.com