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Cardano (ADA) and Solana (SOL) are two of the most popular blockchain networks in the cryptocurrency market. Cardano’s native cryptocurrency is ADA tokens, while Solana’s native cryptocurrency is SOL tokens. Both are marketed as cheaper and faster than Ethereum, the second-largest cryptocurrency by market cap behind Bitcoin. Similar to Ethereum, both Cardano and Solana validate transactions through proof-of-stake consensus mechanisms and incorporate the utilization of smart contracts and decentralized applications (also called Dapps).
However, the ways in which they have competed with Ethereum are slightly different. While Cardano’s developers are heavily focused on scalability and security, Solana’s developers have afforded more effort toward transaction speed and lower costs.
Why you might choose Cardano
In general, Cardano takes an academic approach to development. The network’s security is consistently audited by third parties, and Cardano developers have published many peer-reviewed papers through partnerships with various universities and other institutions. For example, in 2021, the company that developed Cardano, Input Output Group, partnered with Stanford University and Athens University of Economics and Business to explore possible improvements to the Cardano blockchain.
Cardano is the first blockchain to implement the Ouroboros protocol, which offers proof-of-stake functionality with additional security. Unlike some proof-of-stake systems, Cardano's network has a settlement delay, which protects it against various attacks and dishonest participants trying to undermine the network. With this system, the most recently added blocks are considered "transient," not settled. The blocks are settled only after a certain amount is added.
Why you might choose Solana
Innovation and faster speed
While Solana’s protocol is also based on a proof-of-stake consensus mechanism, the protocol was modified slightly to achieve faster speeds. This new technology developed by Solana is called proof-of-history and incorporates timestamps to accelerate transaction speed. Due to this innovative protocol, Solana’s blockchain network is able to handle over 3,400 transactions per second, while Cardano handles about 250 transactions per second.
Low transaction fees
On slower blockchain networks, users may have to compete for block space to get their transactions processed quickly. If too many users on a network try to push transactions through at the same time, it can slow down the system and lead to higher transaction fees as users pay more to jump to the front of the line. With Solana’s proof-of-history protocol and transaction speeds, users on the network don’t often have to compete for block space. This allows Solana’s transaction fees to be incredibly low, averaging just a fraction of a penny.
0% - 3.99%
varies by type of transaction; other fees may apply
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Which is better?
While Cardano and Solana are similar in many aspects, their approach to technology sets them apart. If you’re an investor who values a peer-reviewed, scientific process before implementing new technology, Cardano may be a better fit for your portfolio. If transaction speed is the name of the game, Solana might be the better choice.