Key Points
Solana is a smaller blockchain than Ethereum.
But it's faster, cheaper to use, and suitable for larger-scale applications.
It's also seeing its ecosystem apps get used a lot more.
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Although both are good cryptocurrency picks, Solana (CRYPTO: SOL) is the better investment compared to its arch-rival blockchain Ethereum (CRYPTO: ETH).
Here are just three of the many reasons that's the case.
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1. Users and app revenue are concentrating on Solana
Good investments have durable drivers of value. To find that durable value in the context of crypto, you want to look for a blockchain that people are willing to pay to use, and that they actually use a lot.
Solana matched the combined monthly active wallet addresses of all other major Layer-1 (L1) and Layer-2 (L2) blockchains in June, with 127.7 million monthly active addresses. Ethereum posted 7 million in the same period.
Engaged users are also converting into money, which remains on the network. Solana led all other chains for the third straight time in the second quarter, with roughly $271 million in network revenue. Users have broadly continued to be willing to cough up fees to do their on-chain work since then, though Solana's lead has lessened somewhat.
Look at application revenue, and the picture is similar. In the 30-day period ended Sept. 30, Solana's ecosystem applications generated $186.9 million in app revenue, whereas Ethereum generated $85.6 million despite that chain being several times larger by market cap.
Whereas Ethereum still shines for high-value transaction settlement, the usage breadth is plainly tilting Solana's way. That means more fees today and a stronger magnet for app developers tomorrow, both of which are bullish.
2. More smart contract utilization
In crypto, "transactions" can mean many things. A cleaner way to look at how much a blockchain is being used is thus to examine smart contract interactions, which count when users actually touch smart contracts to perform tasks on a chain.
During the past 12 months, Solana's smart contracts were called on the order of 10 billion times, versus roughly 178 million for Ethereum.
In other words, developers on Solana are seeing a steady drumbeat of real interactions that Ethereum's base layer is simply not matching right now. That usage compounds value for investors, as more smart contract calls create more feedback for teams, more reasons to iterate, and more justification for venture investment to fund the next cohort of apps. That's before even going into the app revenue and fees that users pay.
[SRC] https://finance.yahoo.com/news/3-reasons-solana-better-crypto-101000639.html
