How Solana SOL ranked 5th among cryptocurrencies by market capitalization

Cryptocurrencies

Solana replaces Cardano as the 5th-largest coin as Ethereum fees spike.

“Ethereum is a beast (ETH bull here) which is the future of cryptocurrency — but the gas fees really can affect us,” a Redditor complained in a blog post published Tuesday, explaining the rationale behind purchasing Loopring. “We are tired of paying $150+ in gas fees just to transfer or buy $100 worth of a cryptocurrency.”- coindesk.com

Solana and Cardano will be future competitors to Ethereum as they are capable of processing more transactions at a lower cost. As the average transaction fee on Ethereum has risen a staggering 2,300% since late June, Solana seems to be a place to go as a PoS (proof of stake) blockchain, making it more environmentally friendly than the popular PoW (proof of work) blockchains like Ethereum and Bitcoin.

The US government has ESG (Environmental, Social, and Governance) concerns, and the SEC turned it into a priority, especially on funds such as mutual funds and ETFs. As funds and ETFs turn into the crypto market, the energy consumption narrative will hit the blockchain ecosystem, and conversations about PoW and PoS will be prioritized.

Ethereum with a total market cap of 533.10 billion dollars, and Solana with 122.72 billion dollars, seem to be far away from each other, but as DeFi, smart contracts, NFTs, and all the newly created digital structures evolve and need cheaper, faster, and more efficient solutions, Solana seems to be in a perfect position to fly higher.

Massive amounts of energy to verify transactions.

One and probably the most challenging paths for the blockchain ecosystem is efficiency, as these new digital creations start to get mainstream. The best example is the NFTs, a new industry that is being built from zero. However, as the planet and worldwide politicians pressure each other to reduce carbon emissions and bet on environmentally friendly technologies, the blockchain ecosystem also remains attentive to these concerns.

The proof of stake protocol used by Solana is currently preferred in the cryptocurrency space. Unlike the proof of work where massive energy is needed to run a blockchain, proof of stake makes the validator nodes on the network to stake something. In the case of Solana, the validators stake the SOL tokens. Although the validators also consume power to operate, their power consumption is far lower than that of the PoW miners.- Hassan Maishera in yahoo.com

New projects like Solana got attention from investors because of their efficiency and innovative performance. For example, the Solana network processes up to 60,000 transactions per second, surpassing that of Bitcoin, Visa, XRP, and Ethereum combined with its proof-of-history (PoH) protocol to revolutionize how blockchains work. Ethereum is the unchallenged leader in the smart contract space with 70,000 nodes against the 1,000 Solana nodes.

Solana’s speed and low transaction fee have attracted numerous developers to the blockchain. A wide range of dApps and smart contract projects are now deployed on the Solana project. Thus, making it one of the most widely-used blockchains and cryptocurrencies in the world.- Hassan Maishera in yahoo.com

Final Thoughts

Smart contracts will be the future of the global economy. So, these blockchains like Solana and Ethereum will be structural ecosystems where most industries build their business environments. Like Microsoft, IBM or Apple, Solana is one of the future blockchains that will solve technological constraints for millions and millions of businesses.

Ethereum is about to turn into a 2.0 version and is trying to keep up the pace. However, these new projects like Solana can disrupt the entire ecosystem, turning it into a cheaper, faster, and more efficient environment. With all the challenges we face in the Exponential Age, a key reason for Solana’s growth is that its ecosystem has the backing of FTX, one of the leading digital asset exchanges in the world. FTX has launched several Solana-based projects over the past few months prompting up the token and putting it in an advantageous position to lead the revolution.

More critical than the competition is seeing projects like Ethereum, Solana, Cardano, Polkadot, Terra, Polygon, or Avalanche succeed and offer efficient economic solutions. The future is being designed as we speak. All of us will use a blockchain ecosystem shortly.

Solana is in excellent shape right now. Even when other tokens were dumping, Solana was pumping to all-time highs. More and more developers are using the protocol, which can turn into one of the most important protocols in the smart contract revolution. The future is coming, and it’s coming fast.