Solana (SOL) is more efficient than Ethereum (ETH)
As the crypto asset market begins to strengthen again, Bank of America (BoA) said one crypto could become the next big asset.
Digital asset strategist Alkesh Shah said Solana (SOL) could serve as Visa in the digital asset ecosystem.
The price of Bitcoin (BTC) and crypto assets appeared to find a bottom point and ended one of the worst sluggishness since December in which large crypto assets lost the equivalent of $300 billion in value.
This week, the number one crypto asset BTC increased 3.3 percent. The price of BTC's competitor, Ethereum (ETH), jumped 5.3 percent.
Other large crypto assets also strengthened, such as Binance Coin (BNB) increased 9.5 percent, Cardano (ADA) 16.2 percent and SOL 10.6 percent.
Solana (SOL) is more efficient than Ethereum (ETH)
Shah said Solana is able to provide high traffic, low cost and easy usability.
This makes Solana optimized for consumer needs such as micropayment, DeFi, NFT, web3 and gaming.
The analyst highlighted that there are already more than 400 decentralized projects on the Solana blockchain.
In addition, Solana has a high transaction speed. Shah explained that the innovation enables the processing of 65 thousand transactions per second with a transaction fee of US $ 0.00025 and remains relatively decentralized and secure.
But the variety of uses and fast transactions has its drawbacks.
"Solana prioritizes scalability but a less decentralized and secure blockchain. This is seen through a number of network performance issues after Solana was born," Shah explained.
Ethereum prioritizes decentralization and security but sacrifices scalability resulting in network bottlenecks and transaction costs that swell more than the assets it wants to transact.
Solana was born in March 2020 as a blockchain that can accommodate large-scale applications.
Currently, SOL is the fifth largest crypto asset and has processed transactions worth more than US $ 50 billion and scored 5.7 million NFT.
This network is often juxtaposed with Ethereum because both support smart contracts that are key to decentralized applications, such as blockchain-based banks and NFT.
Over the past year, SOL has attracted attention from investors as it soared more than 4,000 percent. However, SOL is still smaller than ETH.
SOL has a market capitalization of US$47 billion which is one-tenth the size of ETH.
BoA analysts think this valuation difference is a good sign for SOL.
Sol's potential has not been fully reflected in the price, so SOL can still grow and take market share from ETH and other crypto assets.
