Ethereum is the first and more used smart contract blockchain, which allowed the creation of decentralized finance as well as non fungible tokens in top of it.

However, the Ethereum blockchain has some limitations that prevent its scalability like the high fees and the slow processing transactions. For this reason, during the last years have been built new smart contract blockchains that try to improve the Ethereum capabilities. The most successful one, that not leverages the Ethereum Virtual Machine, is Solana, a proof of stake blockchain which use Rust instead of Solidity for smart contracts and proof of history instead of proof of work (now proof of stake).

In this comparison we are going to see if this “Ethereum killer” is killing it or if it is just a competitor that still have to improve in order to be able to confront Ethereum.

Speed.

Solana claims to be the fastest blockchain, they say Solana would be able to process 60.000 transactions per second (TPS), while the current maximum speed on Ethereum is around 30TPS. However, are this maximum numbers really achieved in the current state of the blockchains?

The quick answer is no.

In this graph it is represented (in logarithmic scale) the average transactions per minute (TPM) per day in each blockchain during last 2 years.

Solana’s TPM is 25x faster than Ethereum with ~20.000TPM vs 800TPM respectively.

However, this number is far away from the theoretical maximum speed of each blockchains (60.000 TPS / 30 TPS = 2000).

We can see that Solana is currently processing at 0.5% (20.000 TPS / 60.000 x 60 TPS) of its max capacity while Ethereum its processing at 44% (800 TPS / 30 x 60 TPS).

In conclusion, Solana is processing much more TPS than Ethereum, however, it seems there is not enough current demand to make the blockchain operate at maximum performance. In Ethereum, in contrast, the demand is higher, and this is reflected in the transaction fees too.

Transaction fees.

Transactions fees are the other strong feature of Solana, making it one of the cheapest blockchains with a current average transaction fee of 0.00017$ (170µ$ in the left graph). In contrast, Ethereum is one of the most expensive blockchains in part due to its high demand, reaching an ATH average transaction fee of ~ 50$ during the peak of 2021 bull market and with a current average transaction fee of 1.5$ in part due to the increase of usage of Layer 2 solutions. In sum, currently Solana transaction fees are 9000 fold cheaper than Ethereum.

Despite this high transactions fees, Ethereum is attractive enough to users who paid more than 1M$ each day to use Ethereum and a maximum of 227M$ at 01-05-2022 to mint the Otherside NFT collection from BAYC. The current ratio of total fees paid per day in Ethereum vs Solana is 500 fold, far from the 9000 fold in the comparison in transaction fees, due to a relatively higher demand of Ethereum network.

Failed transactions.

Low transaction cost is good from an user perspective, but it allows that bots abuse the system and send more transactions, some of them legit but some others that can be categorized as malicious and can produce security issues as those experimented in Solana during last year (left image).

Moreover, this can produce a high rate of failed transactions with a mean of 20% in Solana vs 3% in Ethereum which downgrades the Solana user experience.

Number of active users per day.

The above mentioned Ethereum higher demand can be seen also in the number of active users per day. Ethereum users per day were around 1.5-2 fold the Solana user base during 2022.

In the graph below we can see that Ethereum has a relatively constant user base during 2021-2022 between 300K-400K users per day. Whereas Solana user base was much more volatile going from 180K at the end of 2021 to more than 400K users during May 2022 when it surpassed Ethereum and to 220K users that has today.

The relatively constant number of users per day of Ethereum blockchain have means that it has a user base that keep using the blockchain no matter the circumstances, while we see that Solana user base was highly dependent of market conditions with the increase of users during the May 2022 crypto crash after Luna-UST collapse.

Smart contracts deployed.

Regarding smart contracts, Ethereum not only have the bigger ecosystem (with more smart contracts deployed) but it keeps growing faster than Solana everyday. Currently there are deployed 10 times more in Ethereum than Solana.

This could be in part due to the programming language which the smart contracts are written: Solidity in Ethereum, Rust in Solana. There are more Rust developers globally but Solidity developers focus mainly in smart contracts development.

Labelled addresses.

When we analyze the labelled addresses in both blockchains we obtain that in Ethereum there are more than 1M labelled addresses related with centralized exchanges, decentralized exchanges and decentralized applications, while in Solana the amount labelled is less than 500 in all these cases.

The only remarkable type in which Solana has more labelled addresses is in NFTs, 10M vs 22K in Ethereum. What does it mean? Are the most valuable NFT projects/collections moving or minting in Solana or it is due to the cheap cost of minting NFTs ?

NFTs Volume.

We find the answer to the previous question in the right graph.

Ethereum has had more NFT volume during 2022 than Solana, with an ATH at 800M in January 2022 vs 10M in Solana during that period.

Currently there are 10 fold more NFT volume in Ethereum than in Solana.

In conclusion, there are more NFTs projects/collections in Solana because of the cheap minting but the most valuable NFT collections are in Ethereum blockchain.

DEX Volume.

However, when analyzing DEX volume we observe that Solana was able to surpass Ethereum volume during some months of 2022 (in January and May mainly). This coincide with the periods of more Solana users, which were onboard during high volatility periods.

Despite this, from May 2022 the volume has decreased in Solana blockchain and currently Ethereum has 40 fold high volume, which demonstrate that Ethereum keeps being the most important blockchain in decentralized finance.

Number of votes.

Another parameter to compare is the number of votes that have been occurred in both blockchains.

Here we can see that Ethereum had much more votes per day than Solana during last 2 years. Which demonstrate that Ethereum has more Decentralized Autonomous Organizations which are more active than those present in Solana.

Conclusion.

Solana is one of the most important “Ethereum killers” blockchains, which have achieved important milestones as reducing the transaction fees associated with EVM blockchains and decreasing the time between blocks allowing faster transactions.

It has been able to onboard a high number of users, rivaling with Ethereum during some periods and surpassing other blockchains, it has expand the decentralized finance built in Ethereum and has been able to bring it to users which are not able to pay the high fees of Ethereum.

Still, in this process it has sacrificed some important aspects as could be the stability or security of the network. And it has not been able to “kill” Ethereum as Ethereum still has more users, smart contracts, developers, more dapps, more liquidity, more DEX and NFT volume and more DAOs with more activity in its blockchain.

Having said that, as Solana’s project keeps growing and improving is it worthy to keep an eye on it as it could be able to collate Ethereum, improving some of the downsides of it, allowing both blockchains to be alive and to serve a future purpose.