Good morning/evening
So for the sake of my son's second largest asset in his portfolio I thought I had better at least take a look at ETH, my bad.....perhaps I should have done this sooner! Firstly I had to go through the history to check when the poor thing got his ETH whilst hoping it wasn't at the top. Well not the top but it still looks a bit dismal as he bought at 2K but with a bit of hopium again he might come out intact and not at a huge loss. I have no idea why he chose ETH but hey ho each to their own. Perhaps it is because he is a teenager and did no research, or perhaps just because it was number 2 and he already has Bitcoin, we did ask if he would like SOL but he said no, I can only advise, for him to learn he needs to make his own mind up, hell I get it wrong too and have a bag of TIA that is -60%, and wondering to myself if I can trade my way out of it.
So I thought I would have a little look at ETH V SOL
Solana is monolithic whilst Ethereum has a modular design and relies on it's layer 2s to off load and manage transactions to reduce the load on the main chain to speed it up and lower fees. Ethereum used to be POW (Proof Of Work) but is now POS (Proof Of Stake) while Solana is POH (Proof Of History) which is how it is so fast, but it also uses POS.
Ethereum:
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Secure. Decentralized. Battle-tested.
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Runs on rollups now and has a lot of Layer 2's.
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TPS: 15 - 30 on mainnet, but thousands with rollups
Solana:
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Fast. Cheap.
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TPS: possibly up to 65,000 realistically 400–2,000
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Average transaction cost? Less than a cent.
Gas fees
I am definitely a fan of Solana, fast, not expensive and some great easy to use DeFi. The one time I used Ethereum it cost me $50 in gas, I mean how can people trade with those fee's? I use Solana daily and it would take me a long time to get to $50 in gas. There always seems to be the usual crypto rivalries between chains, but it does not have to be one or the other, each have their own merits and you can always use both, I have no problems with Ethereum or people using it and I am not saying I wont use it in the future.
So off I go to etherscan and I can't believe my eyes, is ETH gas really that cheap now?
https://etherscan.io/gastracker
Active Ethereum addresses
Just Ethereum mainnet.
Active Solana addresses
Total Value Locked (TVL)
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Ethereum $46 billion (Includes staked ETH)
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Solana $7 billion (Does not include staked SOL)
Ok so Ethereum continues to lead the DeFi ecosystem in terms of Total Value Locked maintaining a huge share probably due to its mature infrastructure, developer activity and security, but Solana has been rapidly gaining ground, driven by its low transaction costs, and growing ecosystem of DeFi protocols and dare I say memes. The competition between the two is interesting, but do they just each cater for a different type of investor?
As for staking Solana has just slightly passed ETH but this could change in a day!
ETFs
Ethereum has spot ETFs and has since they were approved by the SEC back in July 2024, Solana has a futures ETF but has many applications for a spot ETF. Now don't get me wrong, I think ETFs are a double edged sword, in as much as, yes they may bring the space legitimacy but these ETFs can also give institutional players more influence over price movements, diluting the power of retail investors. They may buy big but they can sell big too.
Inflows and outflows from https://farside.co.uk/eth/
So I personally think Ethereum deserves its number 2 position, it was the first blockchain that had smart contracts and has more upgrades planned. Solana has had its outages, it is just that I prefer the user experience with Solana and perhaps I am just cheap lol. Although the speed is also a great plus. As for my son, I can only hope that if he wants to continue with crypto he will take the time to learn and research as we all do and decide for himself what he wants to invest in. It is a little scary managing a portfolio that is not your own, the risks I take are mine and within my tolerance levels, but for someone else they can be completely different. For now I think my son has a chance with his ETH position to come out with profit at some point.
What are your thoughts on Ethereum? Do you regularly use the chain? Are the gas fees really that much lower now?
As always thank you for reading and please feel free to share your thoughts.
