This Crypto Will Be Ethereum in 2022

key point

  • A market downturn can be a smart opportunity to buy at a discount.
  • Ethereum is one of the strongest players in the crypto space, but it has its weaknesses.
  • Solana is already a worthy competitor and may have a brighter future.

The stock market overall has been hit hard in the past few months, and cryptocurrencies have been particularly hard hit. The global cryptocurrency market has lost more than $1 trillion in the past six months, and individual cryptocurrencies have plummeted in price.

However, this does not necessarily mean that you should not invest now. Crypto is a riskier investment because no one can be sure that it will survive a major recession. But now is also the cheapest time to invest, as prices are at their lowest in months.

Choosing the right investment is difficult as all cryptocurrencies are currently speculative. However, there is one cryptocurrency that may have a bright future. Exactly Solana(brush -4.33%).

How does Solana compare to Ethereum?

Ethereum (Ethereum -1.87%) is one of the most popular cryptocurrencies in the past two years and has many advantages. The network is a decentralized finance (DeFi) project and non-fungible tokens (NFT) market.

However, the biggest problem plaguing Ethereum is speed (or lack thereof). Currently, the network can only process about 13 transactions per second. Slower speeds mean higher transaction fees, and as a result, developers and users alike are flocking to Ethereum’s competitors.

Cryptocurrency purchases in rubles are at a record high. Photo: AFP / Nhac NGUYEN

One of its contenders is Solana, which shines in the realm where Ethereum is rocking. Like Ethereum, Solana is a smart contract platform that can host dApps. However, it boasts speeds of up to 65,000 transactions per second, making it one of the fastest networks in existence.

Solana recently unveiled a recent project. Solana Fay, a decentralized payment system. Solana Pay allows merchants to use cryptocurrency as a payment method. Its decentralized nature means there are no intermediaries, is very energy efficient, transactions happen instantly, and fees are only a fraction of a penny.

With Solana Pay, cryptocurrencies not only compete in the dApp space, but are also becoming a more powerful payment coin. This type of diversity could help Solana succeed in several areas, potentially competing with companies like Visa and Mastercard.

Should you invest in Solana right now?

If you’ve been on the fence about Solana, now might be a smart opportunity to make a purchase. The price has been down nearly 80% since November, and a rebound from this crash could yield significant returns.

That said, there are risks to consider. First of all, Solana uses a proof-of-record consensus mechanism that is different from most other cryptocurrencies. This could increase Solana’s speed and efficiency, while making it less secure and more vulnerable to attack, according to a 2021 report from investment firm Grayscale.

Also, Solana could face more competition going forward, especially as Ethereum completes its upgrades. Ethereum is currently in the process of transitioning to a Proof of Stake (PoS) protocol, which can potentially speed up to 100,000 transactions per second. If that happens, Solana could lose its biggest competitive edge.

This does not necessarily mean that you should not invest in Solana. All cryptocurrencies have their pros and cons, and they are all speculative at this point. Whether Solana is right for you depends on how much you believe in its potential and risk tolerance.

The cryptocurrency market may have gone into recession, but it has been able to recover from past periods of volatility. No one knows what the future holds for cryptocurrencies, but Solana could be a notable company this year.

this article originally appeared From mongrel fools.

Katie Brockman holds a position on Ethereum. the variegated fool Disclosure Policy.


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