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Solana’s scalability and low transaction costs attract traditional financial institutions, positioning it as a serious Ethereum challenger. Despite Ethereum’s current dominance in tokenization, Solana’s advancements in technical updates are driving institutional interest. Especially in the domains of real-world asset tokenization and payments, Solana is attracting interest as one of the blockchain systems capable of subverting Ethereum’s hegemony in the crypto space. According to Sygnum Bank research, large companies, including Visa and Citi, are beginning to pick Solana because of its inexpensive transaction fees, great scalability, and high throughput. This is in line with the increase in the price of the SOL/ETH pair, which has strengthened by 300% in the past year, making it increasingly prominent in the market. Source: Sygnum Solana Recovery and Ethereum’s Layer 2 Challenges  One of the biggest investors in the network, FTX’s fall has also triggered a dip from which Solana has recovered. Solana has rebuilt by adding major technical changes, such as the release of Firedancer, which boosts efficiency and processing capability, following repeated network disruptions and lost investor confidence. Furthermore, the “Only Possible on Solana” marketing has effectively enhanced the network’s standing as a scalable and quick blockchain, attracting developers and market players. Ethereum, on the other hand, has performed worse on several important measures. Though Layer 2 scaling options for Ethereum have expanded, traffic on the mainchain has actually dropped by 15%, which helps to explain Ether’s price drop. These Layer 2s are degrading the Ethereum network more than they are bolstering, some observers worry. With market shares of 81% and 49%, respectively, Ethereum nevertheless keeps leading the real-world asset (RWA) tokenizing and stablecoin industries. Many conventional investors still choose Ethereum even if Solana has potential. Solana has also drawn criticism, though, especially from Edward Snowden, who emphasized the network’s great degree of…

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Filed under: News - @ October 6, 2024 9:12 am