Ethereum Vs Solana
The Ethereum vs Solana debate has become quite a prominent one, with Solana’s proof-of-history (PoH) consensus mechanism presenting a serious challenge to the scalability difficulties of the Ethereum network. This guide will look in more detail at both cryptos, comparing the risk, opportunities and key considerations for traders. We have also provided a list of the top brokers offering Etherum vs Solana trading below.
Top Ethereum & Solana Trading Brokers
#1 - Eightcap
Why We Chose Eightcap
Eightcap’s crypto offering is best-in-class with 250+ crypto derivatives, surpassing that of almost every alternative. Testing also reveals Bitcoin spreads of 12 pips, coming in lower than most competitors, while it offers real-time trading ideas through the Crypto Crusher market scanner. Add in convenient deposits and withdrawals in digital currencies, and Eightcap offers the complete package for serious crypto traders.
"Eightcap delivers in every area for day traders with a growing selection of charting platforms and AI-powered tools. Now sporting 250+ crypto CFDs and the Crypto Crusher market scanner, it's also become a stand-out choice for crypto trading, winning our 'Best Crypto Broker' award two years in a row."
- DayTrading Review Team
- Coins: BTC, ETH, LTC, BCH, XRP, XMR, DSH, EOS, XLM, ADA, TRX, DOGE, BNB, DOT, MATIC, VET, AXS, NEO, SOL, UNI, AAVE, KSM, THETA, CAKE, SUSHI, ATOM, XTZ, SNX, COMP, FLOW, EGLD, PUNDIX, RAY, ZIL, QTUM, BAND, OMG, FIDA, BADGER, NEAR and many more
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: $12 (BTC)
- Crypto Lending: No
- Crypto Staking: No
- Platforms: MT4, MT5, TradingView
- Minimum Deposit: $100
- Regulator: ASIC, FCA, xCySEC, SCB
Pros
- Having excelled across all key areas for day traders, Eightcap outperformed more than 490 competitors to win our 'Best Overall Broker' award for 2024, also securing our 'Best Crypto Broker' title.
- Eightcap stands out with a selection of powerful trading tools, including MT4 and MT5, the innovative algorithmic trading platform Capitalise.ai, and more recently the 50-million strong social trading network TradingView.
- With tight spreads from 0 pips, low commission fees, and high leverage up to 1:500 for certain clients, Eightcap provides cost-effective and flexible trading conditions that can accommodate an array of strategies, including day trading and scalping.
Cons
- Despite a useful library of educational guides and e-books, Eightcap still trails IG’s comprehensive toolkit for aspiring traders with its dedicated IG Academy app and 18 course categories.
- The demo account expires after 30 days and can only be extended upon request - a notable inconvenience compared to the likes of XM with its unlimited demo mode.
- In spite of an increasing variety of tools, Eightcap doesn't offer industry favorites like Autochartist or Trading Central, which offer cutting-edge charting analytics, live news, and market insights for short-term traders.
#2 - Exness
Why We Chose Exness
There is a small range of popular crypto tokens paired with fiat currencies available, with zero swap fees and no commissions in the Standard account. Trading is available via desktop or mobile apps, and deposits via crypto are also available in some countries.
"Exness remains an accessible broker for all experience levels, though experienced day traders will particularly appreciate the ultra-low commission rates, fast withdrawals and high-quality charting software."
- DayTrading Review Team
- Coins: BTC, LTC, ETH, XRP, BCH, SOL, SNX, UNI, BAT, DOT, XTZ, ADA, BNB, ENJ, FIL, DOGE, COMP, THETA, AAVE, LINK, IOST, CAKE, MATIC, HT, MANA, HBAR, INCH
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: Floating
- Crypto Lending: No
- Crypto Staking: No
- Platforms: Exness Trade App, MT4, MT5, TradingCentral
- Minimum Deposit: $10
- Regulator: FSA, CySEC, FCA, FSCA, FSC, CBCS
About Exness
Exness is a Cyprus-based forex and CFD brokerage established in 2008. With over 260,000 clients, several awards and reputable licensing, the broker has maintained its position as a highly respected global brand. Active day traders can access the popular MT4 and MT5 platforms, raw spreads and multiple account types.
Pros
- Highly competitive spreads are available from 0.1 pips and low commissions from $3.50 per side
- There's a strong range of account types for all experience levels and requirements, including Cent, Pro and Raw spread solutions
- Exness is the first brokerage to pass the $1 trillion and $2 trillion marks in monthly trading volumes
Cons
- There are no promotional deals or loyalty schemes for high-volume day traders
- There are several regional restrictions for retail traders including the USA, Europe and the UK
- Unlike most competitors, Exness doesn't provide its own education section
#3 - eToro
Why We Chose eToro
eToro leads the way in cryptocurrency trading, offering competitive spreads and a fixed 1% commission, plus their own wallet service. The broker offers a vast list of 95+ tokens which is continually being updated. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more
"eToro's social trading platform leads the pack with a terrific user experience and active community chat that can help beginners find opportunities. There are also competitive fees on thousands of CFDs and real stocks, plus excellent rewards for experienced strategy providers."
- DayTrading Review Team
- Coins: BTC, ETH, BCH, XRP, DASH, LTC, ETC, API3, CRO, SKL, IMX, ADA, MIOTA, XLM, EOS, NEO, TRX, ZEC, BNB, XTZ, DOT, MKR, COMP, LINK, UNI, YFI, DOGE, AAVE, FIL, ALGO, ATOM, MANA, APE, LRC, ENJ, BICO, BAT, BNT, OGN, MATIC and many more
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: BTC 1%
- Crypto Lending: No
- Crypto Staking: Yes
- Platforms: eToro Web, CopyTrader, TradingCentral
- Minimum Deposit: $50
- Regulator: FCA, ASIC, CySEC, FSA, FSRA, MFSA
About eToro
eToro is a top-rated multi-asset platform which offers trading services in thousands of CFDs, stocks and cryptoassets. Launched in 2007, the brand has millions of active traders globally and is authorized by tier one regulators, including the FCA and CySEC. The brand is particularly popular for its comprehensive social trading platform. Cryptoasset investing is highly volatile and unregulated in the UK and some EU countries. No consumer protection. Tax on profits may apply. 76% of retail accounts lose money.
Pros
- There's a comprehensive online training academy with accessible resources, from bitesize articles to comprehensive courses
- eToro has bolstered its investment offering, most recently with new crypto assets, now offering over 90 digital currencies
- Charts are powered by TradingView and offer strong technical analysis features, including 9 chart types and over 100 indicators
Cons
- There is a $30 minimum withdrawal amount and a $5 fee, which will affect novices with low capital
- There are no guaranteed stop loss orders which would be a useful risk management feature for beginners
- Traders will face currency conversion fees for account denominations other than USD
#4 - LQDFX
Why We Chose LQDFX
You can trade 16 well-known cryptos including Bitcoin, the majority paired with USD or EUR. Spreads are low, starting from 1.02 pips. You can also deposit instantly via crypto with minimum deposits from $20 and no fees.
"LQDFX is best for active day traders looking for ultra-tight spreads, low fees and high leverage up to 1:1000. Forex traders will particularly appreciate the strong range of 70+ currency pairs with minimum deposits starting from $20."
- DayTrading Review Team
- Coins: BTC, LTC, ETH, DSH, XRP, BCH, NEO, ZEC, XMR, ADA, BNB, SOL, LUNA
- Crypto Mining: No
- Auto Market Maker: No
- Crypto Spread: 1.02 - 28.0 pips
- Crypto Lending: No
- Crypto Staking: No
- Platforms: MT4
- Minimum Deposit: $20
About LQDFX
LQDFX is a straight-through processing (STP) broker based in the Marshall Islands. The offshore trading firm offers competitive spreads from 0.0 pips, free deposits, 24/5 support and access to the hugely popular MetaTrader 4 platform. LQDFX also runs a competitive bonus program for short-term traders.
Pros
- Leverage is available up to 1:1000 for experienced day traders
- There are multiple STP account types with fast execution speeds, plus an Islamic swap-free option and PAMM accounts
- Tight forex spreads from 0.0 are available in the raw spread account and the $3.50 per lot commissions are in line with competitors
Cons
- It's a shame that there's no copy trading platform for beginners or experienced strategy providers
- There are no additional charting platforms available, such as MT5 or a proprietary solution
- Market research tools and educational resources are very limited compared to top brands like IG
#5 - Skilling
Why We Chose Skilling
You can trade 50+ crypto pairs via leveraged CFDs. The list of tokens is longer than many rivals, including Vantage with only 30+, and you can get started easily with just $100.
"Skilling maintains its position as a top pick for beginners looking for a competitive zero commission account with direct access to a copy trading feature. It will also serve experienced strategy providers looking to earn commissions, or anyone looking to trade forex during extended hours."
- DayTrading Review Team
- Coins: ACM, APE, AVE, ATM, AVA, AXS, BTC, BAR, BNB, BTC, BSV, XBN, ADA, CHZ, ATOM, CRO, DASH, MANA, DOGE, EOS, ETH, ENJ, XET, ETC, FTM, ONE, HT, IOTA, JUVE, LTC, LNK, XLC, XMR, NEO, OMG, PSG, CAKE, DOT, MATIC, QTUM and many more
- Crypto Mining: No
- Auto Market Maker: Yes
- Crypto Spread: BTC 0.5
- Crypto Lending: No
- Crypto Staking: No
- Platforms: Skilling Trader, MT4, cTrader, TradingView
- Regulator: CySEC
About Skilling
Skilling is a multi-asset broker founded in 2016 and based in Cyprus. The brand offers hundreds of day trading instruments with competitive spreads from 0.1 pips and beginner-friendly platforms. Skilling are also regulated in Europe and beyond with a transparent pricing structure. You can sign up and start trading in three easy steps.
Pros
- The €100 deposit and zero commissions in the Standard account are accessible for beginners
- The Skilling Copy solution is accessible directly from the cTrader web terminal, making it easy for strategy providers to manage their portfolios
- Excellent third-party charting platforms are available for serious day traders, with dozens of technical indicators and advanced order types
Cons
- Skilling trails alternatives like IG when it comes to research tools that can help day traders make informed decisions
- You can only access shares in the Skilling Trader platform and fewer instruments are available overall in the MT4 accounts
What Is Ethereum?
Ethereum is a decentralised network and blockchain, much like Bitcoin. It was released in July 2015 by Vitalik Buterin and Joseph Lubin, amongst others, and has its own cryptocurrency token, Ether (ETH). In terms of market value, only Bitcoin is larger than ETH, which is important to note when considering the benefits of Ethereum vs Solana.
Ethereum has become hugely popular in recent years because it has features that Bitcoin does not. Bitcoin is mainly a payment network, whereas Ethereum also runs decentralised applications (dapps) using smart contracts. However, going back to Ethereum vs Solana, Solana now also has an extensive range of dapps.
Cryptocurrencies like ETH are popular with traders as they are volatile and influenced by factors that traditional currencies are not. Additionally, traders can speculate on the price movement of ETH without actually owning the crypto through CFDs and spread betting, which are offered by a range of brokers like CMC Markets. With regards to Ethereum vs Solana, traders may find it easier to trade ETH given its prominence in the crypto market.
What Is Solana?
Solana, like Ethereum, is a blockchain network based on decentralisation. Solana was launched in March 2020 (founded by Anatoly Yakovenko) and its cryptocurrency, SOL, is among the top ten by market cap. This has increased focus on the Ethereum vs Solana debate, as can be seen on social media like Reddit and Medium. The platform and its cryptocurrency have seen fast growth, mainly because its consensus mechanism (PoH) has undercut other platforms in terms of transaction times and fees. Having said that, Ethereum remains a dominant player in the DeFi market.
SOL can be traded in the same way as ETH, though traders can also stake any spare or inactive SOL funds, essentially earning passive income through interest. This is an important differentiation to note for Ethereum vs Solana.
Ethereum Vs Solana Similarities
Trading
When considering Ethereum vs Solana, be aware that both ETH and SOL can usually be traded on the main crypto centralised exchanges. A centralised exchange is a platform where a third party holds your funds through custodial wallets once they are deposited in your account, allowing you to trade and purchase other tokens through their network. Certain cryptos can also be traded on decentralised exchanges, where the trader always retains control of their funds.
Centralised exchanges may be a more appropriate starting point for novices, as traders may find they offer a more user-friendly experience and have better educational material available. However, as decentralised exchanges do not involve a third party, they do not require users to have an account, which can allow traders to begin trading faster and maintain anonymity. It may be easier to trade Ethereum vs Solana on some decentralised exchanges, given its greater size and popularity.
Both Ethereum and Solana be traded as CFDs and through spread betting, which can both involve leverage. Leverage allows traders to gain increased exposure to a market for a given amount of capital, which has the potential to increase both returns and losses. When deciding on Ethereum vs Solana, note that both ETH and SOL are volatile, which can make leverage a high-risk strategy.
Whatever decision traders make regarding Ethereum vs Solana, amateur traders should start with the spot market, where exchanges will allow you to go long (buying an asset with the hope that its value will increase) or go short (selling an asset with the hope that its value will decrease and then buying it back).
Storage
For those wanting to store either Ethereum vs Solana, a crypto wallet is required. There are several different types of wallets available depending on a trader’s preference. For example, there are ‘hot’ wallets that are connected to the internet, offering more convenience at the expense of being more vulnerable to hackers. ‘Cold’ wallets, on the other hand, are not connected to the internet, so are recommended for funds that traders do not anticipate using for a prolonged period.
Wallets for the two different blockchains (Ethereum vs Solana) will share common themes, such as a public key, which is how people can send you money and a private key, which is how you access the funds in your wallet.
The right wallet will depend on the trader’s experience with crypto, the quantity of funds they are depositing, what they plan to do with the funds and other factors. When choosing which crypto to trade (i.e Ethereum vs Solana), always research the different wallets available.
Regulation
Although regulators and governments have taken a more active interest in cryptocurrency in recent years, the market still lacks the regulation that is imposed on traditional money markets. In the UK, cryptoassets are generally only regulated for money laundering purposes and traders should be aware that they are unlikely to have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme. Those considering Ethereum vs Solana should be aware of the risks involved.
Ethereum Vs Solana Differences
Consensus Mechanism
Proof-of-work (PoW) is the current consensus mechanism for Ethereum. This is where miners complete complex mathematical puzzles before the solution is then verified by other miners. Transactions are then added to the blockchain ecosystem and the miner that solves the puzzle receives a reward in the form of ETH. This process maintains the security and integrity of the platform by reducing the risk of fraudulent transactions being added to the blockchain. Whether it’s Ethereum vs Solana, Polkadot, Cardano or Bitcoin, all these blockchain networks need a consensus mechanism to verify the legitimacy of new transactions and maintain the security of the system.
Ethereum will soon be moving to a different consensus mechanism, proof-of-stake (PoS). This method is becoming much more popular as it uses significantly less energy and addresses some of the environmental concerns some users have when considering Ethereum vs Solana. Instead of miners competing to solve mathematical puzzles, a particular ‘validator’ is chosen to forge each block. To be chosen, participants must stake some crypto, with the more staked the more likely you are to be chosen.
Solana has built on the PoS consensus mechanism and pioneered a concept called proof of history (PoH), which can process transactions and add them to the blockchain must more quickly. When considering Ethereum vs Solana, Solana can process more than 50,000 transactions per second (TPS), whereas Ethereum can only do around 15.
Speed
Transaction times are usually much faster on the Solana blockchain in comparison to Ethereum’s, a significant differentiation when weighing up Ethereum vs Solana. The former is a crowded network and its reliance on individual miners processing transactions slows the system down. Solana, on the other hand, adopts a more automated consensus mechanism through PoH. The quicker the transaction time, the better for crypto traders, as they can respond more quickly to price movements.
Distribution
ETH was initially distributed in an Initial Coin Offering (ICO). Unlike Bitcoin, there is no maximum supply for ETH, though its annual supply is limited to 18 million ETH.
When the Solana network launched, it had an initial total supply of 500 million SOL, though this has now reduced by around 11 million SOL. Tokenomics and the supply of crypto are important when considering Ethereum vs Solana.
Price & Market Cap
ETH has a much higher market cap at over $400 billion, compared to SOL’s $40 billion. Both are sizeable but ETH is still in a dominant position. Whether SOL can close this gap will depend, in part, on the success of the PoH consensus mechanism and the reaction of those closely following Ethereum vs Solana.
In terms of the respective cryptos of Ethereum vs Solana, ETH’s higher market cap is reflected in the price of ETH, which sits around $3,500, compared to SOL’s $150. Cryptocurrencies with higher markets capitalisations are usually favoured by more risk-averse traders, although all cryptos are volatile to some degree, which traders can see through an online chart showing the change in the value of a particular crypto over time.
It is also worth noting that the transition of Ethereum from PoW to PoS may cause the price of ETH to appreciate because of the much lesser environmental impact of PoS models. This may create greater opportunities for those trading Ethereum vs Solana.
Transaction Costs
In many ways, Ethereum has become a victim of its own success. Attracting more users onto its network has created bottlenecks and a crowded platform. This has caused transaction costs (also known as gas fees) to increase as miners prioritise those who are willing to pay the most. Ethereum 2.0 will go some way to addressing these issues by adopting the PoS consensus mechanism but, turning to Ethereum vs Solana, SOL’s PoH is still likely to be superior in terms of transaction times and fees.
Pros Of Ethereum For Traders
- Despite competitors like Solana, Ethereum is still considered a leader in the DeFi and the NFT markets
- Ethereum 2.0 and the transition to PoS is likely to improve transaction times and reduce transaction costs
- ETH has a significantly higher market cap than SOL, which can mean lower volatility, though all cryptos are quite volatile
Pros Of Solana For Traders
- Opportunities to earn yield through staking
- Quicker transaction times and lower fees is a strong selling point for Solana (vs Ethereum)
- SOL has seen fast growth and the blockchain could take a dominant position in the DeFi industry in the future
Security
In July 2016, the Ethereum blockchain was hacked, resulting in $50 million of funds being stolen. This led to a split of Ethereum Classic (ETC) and Ethereum.
As with all networks, much of the talk around Ethereum vs Solana concerns security and the integrity of the platforms. However, Solana has not avoided negative publicity; in September 2021, it suffered a denial-of-service (DoS) attack which resulted in the price of SOL plunging.
Accepted Countries
Cryptocurrencies like Ethereum vs Solana can be traded from around the world, although some countries have imposed restrictions or made the use of cryptocurrencies illegal. Traders deciding on Ethereum vs Solana should check whether any restrictions apply in their country.
Ethereum Vs Solana Verdict
Talk of new rivals to the Ethereum network is not particularly new. However, Solana has pioneered a genuinely innovative concept, PoH, which, despite its youth, has been seen to produce much faster transaction times and lower fees. The true success of PoH could be a game-changer in the Ethereum vs Solana debate. SOL is certainly looking attractive to investors, though Ethereum is still considered the dominant player in the DeFi space and ETH has seen strong gains of its own.
FAQs
What Is Ethereum 2.0?
Ethereum 2.0 is an upgrade to the Ethereum network that is taking place in several phases over 2021 and 2022. The objective of the upgrade is to improve speed and lower fees on the network by transitioning to a proof-of-stake model and it could redefine the Ethereum vs Solana debate.
Is It Safe Trading Ethereum Vs Solana?
The cryptocurrency market lacks the regulation that major stock or forex markets have. Cryptos can also be very volatile as they are highly speculative. This creates opportunities for traders, though all traders should be aware of the risks when investing in cryptos and debating Ethereum vs Solana.
What Is Blockchain Technology?
Blockchain technology is a type of database where all transactions are chronologically recorded and publicly available, with all users needing to agree before new blocks (data) is added through a consensus mechanism. Whether it’s Ethereum vs Solana or Polkadot vs Bitcoin, blockchain technology and consensus models are key considerations.
What Are Proof Of Work And Proof Of Stake?
Proof-of-work is the traditional blockchain consensus mechanism, which involves miners solving mathematical puzzles to add new blocks and earn rewards. Proof-of-stake is where a particular validator is chosen to forge the new block using randomisation, rather than miners competing against each other. It’s a key differentiation when looking at Ethereum vs Solana.
Why Does Solana Have Fast Transaction Times?
The principal reason behind Solana’s fast transaction times is its proof-of-history consensus mechanism, which allows transactions to be quickly verified between two events, creating a more efficient process.