As the second most valuable cryptocurrency by market cap, Ethereum enjoys popularity amongst the blockchain enthusiasts. It is the most popular blockchain to send ERC-20 tokens, accounting for 85% of dApp transactions. Most DeFi projects run on the Ethereum blockchain.
Nevertheless, there are issues. As its blockchain grows in popularity, the price to send Ethereum transactions becomes more expensive. Recently the astronomical fee of $2.6 million caused analysts confusion. The issue has already been addressed by Ethereum creator, Vitalik Buterin, who has stated changes to the protocol would keep this from happening again.
Network congestion, high fees, and difficulty programming dApps on the platform have made several other blockchains attractive platforms.
Of the other alternative blockchains, Cardano (ADA) appears to be getting momentum. Cardano launched in 2015 with a scientific approach to blockchain development. Most of the development team are classically trained programmers or blockchain scientists.
Like Ethereum, Cardano focuses on smart contracts, dApps, and secure transactions. Looking at the “Why” version on their website, there is an impressive number of crossovers.
Cardano’s recent development of the Shelley testnet for Cardano and Coinbase’s decision to allow staking have boosted Cardano’s price. Users staking Cardano will earn 4.6% interest on their coins, which is where Coinbase’s custody solution makes sense. By allowing users to stake on their platform, Coinbase is ensuring that clients have a convenient place to earn returns. They have already enabled Tezos staking, which may have been the reason XTZ is now over $3.00.
At the same time, Ethereum is working on Ethereum 2.0. This upgrade will make Ethereum faster and implement a Proof of Stake (PoS) algorithm instead of its current Proof of Work (PoW). Other 2.0 improvements include improved scalability and smart contract implementation with sharding.
Once Eth 2.0 launches, holders of regular Eth will be issued the 2.0 tokens at a 1:1 distribution. For every old Eth held, a new one will be issued. We may see a bull run in Ethereum leading up to this token distribution, as we have seen in other coins forked/airdropped in the past.
Which One is Better?
The blockchain space is still in its infancy, akin to dial-up internet from the ’90s. Asking “Which One is Better” is akin to asking which kind of horse-drawn wagon design will be most popular before the internal combustion engine’s invention.
Both Ethereum and Cardano have established themselves as mainstays of the cryptocurrency world. They rank at #2 and #6 based on market cap. Both teams have talented and driven dev teams behind them. With Cardano’s staking and Ethereum’s 2.0 network on the horizon, there is no reason both cannot win in the end.