Cardano Vs Solana
Cardano vs Solana, the fight between two of the most popular and fastest-growing cryptocurrencies of 2021. So which coin is better suited for investment. Our article offers a comparison of Cardano vs Solana, detailing prices, underlying technologies, transaction speeds, respective market caps and other key factors that should be considered when looking to invest in crypto.
What Is Cardano?
Cardano, token name ADA, is a cryptocurrency developed by Ethereum co-founder Charles Hoskinson to solve many of the issues perceived in earlier coins like Bitcoin and Ethereum 1.0. Cardano operates on a proof of stake blockchain platform, designed to be safer and consume less energy than traditional proof of work cryptos such as Bitcoin.
When considering Cardano vs Solana, it is important to understand the origins of the tokens. Work began on creating Cardano in 2015, with the project publically launched two years later. Like many cryptos, ADA aims to decentralise financial services, allowing countries without a reliable banking system to trade on a level playing field. Cardano’s commitment to this principle led to their partnership with the Ethiopian government, with Cardano technology used to create permanent records for over five million students and teachers. This also means that there is no owner of the crypto, with every ADA holder having a stake in the Cardano network.
The cryptocurrency’s recent “Alonzo” update added smart contract capability. Cardano immediately proved to be a popular platform for smart contracts, with over 100 processed within the first 24 hours.
Cardano has a market cap of $71 billion, which is the third-highest of the cryptocurrency market. The current ADA price per token can be found online on sites like CoinGecko.
What Is Solana?
Next in the Cardano vs Solana debate: Solana, token name SOL, was created by Anatoly Yakovenko, Stephen Akridge and Greg Fitzgerald based on Yakovenko’s concept of a proof of history blockchain, which implements technology for keeping time within untrusted networks. With proof of history, processing could occur at a far higher speed than the leading blockchain technology of the time and a comparable speed to modern payment methods such as Visa.
Conceptualised in 2017, Solana launched onto public trading platforms in April 2020. Its utilisation in over 400 smart contracts places Solana as an integral part of decentralised finance, often abbreviated to DeFi. Major crypto exchange FTX chose Solana for its trading network and the foundation for US dollar-tracking stablecoin USDC due to its high transaction speed and low transaction costs.
Solana has a market cap of $42 billion, placing SOL as the 7th highest market cap cryptocurrency. Today’s price per token can be found on sites like CoinMarketCap online.
Cardano Vs Solana Similarities
- High Market Caps – Both Cardano and Solana have multi-billion dollar market caps, which generally means that these coins will be comparably stable when compared to emerging, lower-market-cap coins. Of course, this is not a steadfast rule and price predictions in crypto are notoriously unreliable but investments in these coins will often be less volatile than in a new, growing token.
- Potential For High Transaction Speeds – Solana currently operates at a potential speed of 50,000 transactions per second (tps) but with projected future hardware advances this speed is expected to reach up to 700,000 tps. While Cardano is at a comparably low 250 tps, its planned “Hydra” update aims to enable up to 1 million transactions per second across the network.
- Smart Contracts & NFTs – These crypto platforms both support smart contracts and the exchange of non-fungible tokens (NFTs). Cardano’s most recent “Alonzo” update, which enabled this capability, has been met with great interest and early adoption. Of the two, Solana is the more established platform for these functions, having over 400 smart contracts and successfully providing the technology for several large-scale NFT auctions.
- Efficient & Environmentally Friendly – Both Cardano vs Solana offer alternative platforms to the well-documented, resource-intensive nature of cryptocurrencies like Bitcoin and the current Ethereum technology. Bitcoin mining alone accounts for roughly the same level of carbon dioxide emissions each year as New Zealand. Both Cardano and Solana have a far smaller environmental footprint.
Cardano Vs Solana Differences
- Transaction Speed – As previously mentioned, Solana’s network allows for transaction speeds rivalling that of traditional, centralised methods of currency exchange and payment. Despite its plans for future increases, Cardano lags far behind Solana in transaction speed.
- Transaction Fees – Transaction cost is another area of comparison in which Cardano is inferior to Solana. SOL boasts an average transaction cost of $0.00025, while ADA costs can amount to as much as $0.40. Whether looking to purchase NFTs, fulfil smart contracts or even day trade between cryptos, these fees will soon add up and amount to a tangible, long-term difference between the coins.
- Underlying Technology – Where Cardano utilises a proof of stake based platform, the developers of Solana implemented a proof of history technology within its cryptocurrency. Through optimising elements like block time, which can reach up to a lightning-fast 400ms on the Solana network, the proof of history system allows efficient and fast trading, providing a viable alternative to existing transaction methods.
Pros Of Cardano For Traders
Some pros of investing in Cardano vs Solana:
- Thorough Testing Of New Features – Cardano takes a slow-and-steady approach to development, with each step peer-reviewed and carefully tested. While this means that Cardano may lag slightly behind other coins when implementing new functionality, the expectation is that additional features will launch with less chance of teething issues that can damage the reputability and price of a coin.
- Easy-To-Swallow Coin Price – Valued at just over $2, ADA’s low price enables far easier relation to currencies that most find familiar. With cryptocurrency still in relative infancy, most will still relate goods and services to traditional currency costs. The low coin price of Cardano enables traders to quickly and easily work out this cost. For example, if bidding on a piece of digital art, the mind is more easily able to translate 11.8 ADA to $25 than 0.0091 ETH. In terms of Cardano vs Solana, while SOL is far lower priced than crypto frontrunners Bitcoin and Ethereum, the difference between the coins is still significant.
Pros Of Solana For Traders
Here are some factors in the Cardano vs Solana debate that favour SOL for investment:
- Faster Transaction Speeds – transaction speeds comparable to existing methods make Solana one of the most viable alternatives to everyday payments that exist in the DeFi economy. This attribute, along with the negligible transaction price of Solana, perhaps provides the highest level of long-term potential for SOL.
- Lower Costs For Trading NFTs & Smart Contracts- Lower costs compared to its competitors in the smart contracts and NFT trading space means that Solana is an attractive ecosystem for those looking to engage in these areas. While Solana doesn’t have the first-mover advantage nor the ubiquity enjoyed by Ethereum, its infrastructure is far ahead of its main competitor and likely shall be even after the release of Etheruem 2.0.
- Enhanced Cross-Platform Interaction- Wormhole is a protocol that allows crypto assets like NFTs and tokens to seamlessly transfer between blockchain networks that would not normally allow flow. Operating on transfers both in and out of the Solana platform, Wormhole currently works with the Ethereum, Terra and Binance Smart Chain networks. This augmented interconnectivity allows traders greater fluidity for assets and streamlined trading mechanisms between supported platforms.
Other Relevant Details
Derivatives trading of cryptocurrencies, such as CFDs, options and futures, was banned at the beginning of 2021 within the UK by the FCA. As a result, neither Solana nor Cardano can be traded with leverage in the UK. However, these restrictions are not global and brokers from other countries may support this functionality.
When debating Cardano vs Solana, both are provably secure as long as more than one-third of the total nodes are honest. While this does not make these cryptos invulnerable to attack, a stake required to do so would amount to tens of billions worth of the tokens. The Solana network recently came under a 400,000 transactions per second DOS attack that disrupted the functionality of the network. However, all assets within the network remain secure during such an attack.
Long-term investors might be interested in staking their cryptocurrency, which generates interest in exchange for not trading a token for some time.
If you are looking to stake Cardano vs Solana, the latter comes out on top. Binance Earn offers flexible staking rates of 0.78% APY for Solana, compared to 0.48% for Cardano. When staking for a locked 30 days, Binance offer 9.2% APY for Solana, compared to 5.09% for Cardano. When locked staking over 60 days, Solana gets a 9.9% APY, whereas Cardano achieves a rate of 7.79%.
Final Word On Cardano Vs Solana
When looking at Cardano vs Solana, many factors may make each cryptocurrency appealing to different traders. The higher market cap of Cardano could suggest that the coin is a slightly more stable long-term investment, while the higher speeds and lower costs of Solana transactions provide a vision of long-term potential operating as a leading crypto asset in the decentralised finance sector. Both Solana and Cardano can be used to purchase NFTs and fulfil smart contracts, as well as presenting ambitious roadmaps to further develop their respective technologies.
How Many Transactions Per Second Can Be Achieved On Cardano Vs Solana?
Solana boasts the ability to perform up to 50,000 transactions per second, with future hardware advances predicted to facilitate speeds of up to 700,000 transactions per second. Cardano can perform up to 250 transactions per second but future updates to the platform promise to increase this to around 1 million transactions per second.
Can I Use Smart Contacts And Trade NFTs On The Cardano Vs Solana Networks?
Both the Cardano and Solana networks enable the fulfilment of smart contracts, as well as the secure and private trading of NFTs.
What Technologies Do Cardano And Solana Use?
Solana utilises a proof of history blockchain network for mining and transfer, allowing greater transaction speed, a smaller mining energy footprint and lower costs than proof of work systems. Cardano operates on a proof of stake platform, similarly superior to the proof of work system that underlies cryptos such as Bitcoin and Ethereum 1.0.
How Safe Is Purchasing Cardano Vs Solana?
Without a malicious party owning a stake amounting to tens of billions of dollars, both Cardano and Solana are provably secure, meaning that transactions will be safely executed between the intended sender and recipient. Like all cryptos, Cardano and Solana should be purchased from a reputable and secure cryptocurrency trading platform to eliminate the risk of fraud.
What Is The Price Of Cardano Vs Solana?
The current prices of Cardano vs Solana can be checked online through cryptocurrency database websites like CoinGecko and CoinMarketCap. Such sites can also be used to compare Cardano, Solana and other cryptos like Polkadot, Algorand, Avalanche, Matic and Ethereum.