Why Sam Bankman-Fried Says Solana Will Beat Ethereum To Adoption
In the race to mass adoption, FTX’s CEO Sam Bankman-Fried believes his favored smart contract protocol Solana will beat Ethereum.
Covered:
- Sam Bankman-Fried’s Appearance At Crypto Goes Mainstream
- Ethereum’s Scaling Plans v. Solana’s
Sam Bankman-Fried’s Appearance At “Crypto Goes Mainstream”
Sam Bankman-Fried, the billionaire behind crypto exchange FTX, said at the Yahoo finance conference this week that he believes Solana was “one of the few blockchains with a roadmap to scale millions of transactions.” He went on to say that Ethereum and most blockchains are “not focused” on scaling. He spoke at the Decrypt and Yahoo conference called “Crypto Goes Mainstream” and stated that the “biggest upside” for Solana was its ability to handle “an enormous amount of users and transactions.”
Solana can handle 60,000 transactions per second at a cost of $0.0015 per transaction, while Ethereum handles only 13 transactions per second with a cost that can breach into the thousand dollar range, depending on the day, time, and demand. This does not come without a cost for Solana, though. Solana has prohibitive validator requirements to make their speeds a possibility, leading to worries of centralization. It already requires 24 cores, 128 GB Memory, 2 TB NVMe, 1 GB Network, and a high-end graphics card. Not your average consumer PC.
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However, the market is responding very well to fast, cheap L1’s, despite any issues behind the curtain. Solana is the winner of those L1s as it stands, and Bankman-Fried believes they will beat Ethereum to mass adoption. Speed, instant finality, and low fees are what is needed for something like cross-border remittances, something crypto enthusiasts have always mentioned as a major use case. It is this type of use case that excites investors of all stripes, including Fried–and it requires scalability. In his speech at the event, Fried claimed that Solana is focusing on scaling, and Ethereum is not. To that end he said:
“That is not where a lot of other blockchains have been focusing, including ethereum.”
Ethereum’s Scaling Plans v. Solana’s
I think many would beg to differ; Ethereum and its sharding, which will arrive with 2.0 is set to increase speed and decrease cost drastically. Bankman-Fried said that “a mass-scale application business” would need to accommodate millions and even billions of users and transactions per second. He claims that a million transactions per second are a “requirement” of any mass scale system.
However, to put it in perspective, VISA processes nowhere near that many transactions per second, even being the centralized behemoth they are. Nevertheless, Bankman is banking on scaling being the main property that will propel Solana beyond all its other competitors. The two other critical and intrinsic properties are decentralization and security. While those may seem obviously necessary, most L1s, if not all, are sacrificing one for the other–Vitalik calls this the blockchain trilemma.
Binance Chain (BSC), earlier this year gained massive adoption and did so by embracing scaling over the other 2 properties, as of course, BSC is centralized, very centralized–with only 21 validators in total. Nowadays, no one talks about a BSC “flippening” regarding ETH or Bitcoin. Why is that? It is obviously because people have not taken Binance Chain as a “serious” competitor, due to centralization.
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While people have made millions from it, is not talked about like Solana is talked about. You never hear about big VCs dumping money into BSC. What VCs are thinking is not which chain can get the most users, but which chain can attract the most businesses–in TradFi and DeFi–with the most unique applications and uses. It is true though that users trump everything in many ways, and that takes scaling. Being the most decentralized or secure chain with no users is a pointless effort. It is a delicate dance to maintain all the properties and the chain that executes each one in the most effective way possible, is bound to win.
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Text source: CryptosRus
