Since the boom of the DeFi summer, scalability issues with the Ethereum Network have become a major pain point for most users. This has been further exacerbated with the rise of NFTs and DeFi becoming more mainstream. This season Binance Smart Chain (BSC) has been dominating the space as an alternative to Ethereum. BSC offers users low gas fees and higher speeds in comparison to ETH. This has been clearly pronounced when looking at TVL and transaction volume on Pancakeswap vs Uniswap. As of writing this article Pancakeswap has TVL of around $8.1 Billion VS Uniswap’s $6.39 Billion.
Blockchain's Impossible Triangle
However, to most who understand the underlying problems with Blockchians, BSC is only a band aid solution and doesn’t solve the impossible triangle: Scalability, Decentralization, and Security. Ethereum has Decentralization and Security. Whereas BSC has Scalability and Security. Neither solve the full trinity.
This is where Solana has quietly been growing momentum and support in the Crypto and Blockchain space, particularly from Blockchain Developers. The key variables to look at while addressing the impossible triangle for cryptos are typically Validators/Nodes, Transaction Latency, Transactions Per Second (TPS), and Avg. Fee Per Transaction. Below is a chart that outlines the differences between BSC, ETH, and SOL:
When looking at the data above, a picture becomes pretty clear about the technical advantages Solana has over the two current blockchains dominating the space. The most significant to Crypto developers tends to be TPS and validators. In the case of Binance, they have 21 nodes and 15 are controlled by Binance, which means unless they add significantly more, decentralization isn’t on the table. Ethereum has low TPS and high fees, meaning scalability is their current issue. When looking at Solana on the other hand. They appear to achieve the trinity of Scalability, Decentralization, and Security.
Solana as a DeFi Blockchain
With the growth in popularity of DeFi platforms on their network such as Serum, Raydium, Maps, Bonfida, and countless others entering the ecosystem. The rise of Solana as a top tier blockchain competitor appears to be imminent. Furthermore, with prices of $SOL, $SRM, $RAY, $MAPS, and $FIDA surging. The market seems to be catching onto the potential for Solana.
Underpinning the technical and price analysis of Solana is who is backing this project. SBF is regarded the world over as one of the most influential people in cryptos. Has been the most outspoken advocate for Solana and one of their core backers. So the significance of his blessing for this blockchain cannot be overstated. Largely due to the cult following SBF has garnered in the crypto space.
The Solana Ecosystem & Caveats
When looking on the ecosystem page of Solana it becomes obvious that they’ll soon roll out enough projects to flesh out an ecosystem that can go neck and neck with Ethereum and Binance Smart Chain.
However, one caveat for Solana is the language it is written in. Projects on Ethereum can effectively copy and paste their code onto Binance Smart Chain as well as use the same tools from a Solidity environment because BSC is EVM compatible. Whereas Solana is not EVM compatible. Furthermore, Solana is written in Rust, which has far fewer developers available than in the ETH and BSC ecosystems.
It will be interesting to see whether or not ETH 2.0 will deploy fast enough to regain traction lost to BSC, or if Solana will rise quickly enough to overcome EVM blockchains as a whole. Moreover, each of these blockchains has their own unique advantages, from ETH’s first mover advantage to BSC’s current low gas fees paired with CZ and Binance’s backing. So only time will tell which blockchain wins the title of the de facto DeFi platform.
There are many differences that set Solana apart from other Blockchains. So if you’d like to learn more on Solana checkout their website http://solana.com/ or ours https://genesisblockhk.com/what-is-solana/ for supporting information.
The Rise of Solana was written by John Keh and the data verified by the Solana team.
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