Ethereum, the ecosystem’s second most popular digital currency, has proven to be a formidable force. Notably, the Ethereum chain has grown to be the second-largest project in the ecosystem in terms of market capitalization.
Since its establishment, it has managed to surpass numerous popular projects like Litecoin, Dash, XRP, and Monero, which were established earlier. The primary reason for the meteoric rise is the tech behind the project. Seeking to foster innovation by enabling the development o decentralized applications (dApps), Ethereum became the foundation of the DeFi ecosystem and the millennial NFTs & Metaverse industry.
Although it is the second most popular cryptocurrency project, ETH has its weakness, which allows other projects to compete by addressing some issues it lacks.
As the Ether blockchain began to grow, the users on the network started witnessing network congestions. Besides, with time, the transaction fees on the network also got too high.
Following the path of Bitcoin, Ether also has a consensus mechanism based on the Proof-of-Work algorithm. Due to the high power usage algorithm, the blockchain has a high carbon footprint.
Seeing the concerns of low scalability, network congestions, and high carbon footprint, some Ethereum killers stepped into the scenario to unseat the blockchain by addressing solutions to the issues. These killer blockchains intend to solve the issues using the Proof-of-Scale consensus mechanism. Some of the most popular Ether killer chains are Cardano, Solana, Polkadot, and Tezos.
Popular Ethereum killer chains
There are many Ethereum killer chains established over the years. However, there are only a few contenders that have the true potential to unseat Ether as the largest Altcoin. Developers of these chains noted the plague on the Ether blockchain that caused due to a variety of issues.
Ether Killers seeks to be a more energy-efficient solution. These blockchains are keen to be seen as less expensive and more functional blockchains in comparison to the Ethereum network.
Below, we have some common rivals of the Ether network that are stealing the second-largest blockchain market portion:
Solana (SOL)
The on-chain Solana network has more than 250 operational projects running on top of it. According to data from CoinMarketCap, Solana is among the top 10 cryptocurrencies by market capitalization at press time. Besides, SOL, the native cryptocurrency of the network that acts as a medium of exchange, is much more efficient and scalable in comparison to the ETH coins.
Solana’s connectivity boasts an economic breakthrough by maintaining the highest levels of decentralization and security. The network’s eight-core inventions are accountable for this record-breaking throughput. Notably, its main network operation is a beta phase, which is also the major driver that halts the blockchain from gaining ascendancy.
On the other hand, where an ETH transaction charges a gas fee of about $6-$12, an SOL transaction asks for only $0.00020-$0.00025. With a cheaper fee, the chain also processes the transactions more than 3,800 times faster as compared to ETH.
Solana comprehends that transaction fees and pace are most significant for further adoption and real-world use-case.
Cardano (ADA)
Cardano is a blockchain network with the most robust community in the ecosystem. According to data from CoinMarketCap, Cardano is currently the eighth largest cryptocurrency project in terms of market capitalization.
The blockchain employs Ouroboros, a consensus, and security protocol that is based on the Proof-of-Stake mechanism. Thanks to the protocol as it is the reason which makes the blockchain more scalable and allows users to transact at a great pace and at a lower fee.
On the other hand, the network also launched its Hydra project, which aims to enhance the transaction processing pace by more than 300%. With all this, Cardano processes 250 transactions per second. However, the chain is under development, and the developers are keen on researching with the aim of 1,000 TPS.
Besides, the blockchain is also energy efficient, as it uses the PoS mechanism to validate transactions on the network. According to data from Cardano Cube, the project has 579 decentralized applications (dApps). However, the number is too smaller in comparison to the Ether chain.
Tezos (XTZ)
Another contender in the list that aims to unseat Ethereum and stands out following its unique governance model. In contrast to others, the chain is self-governed because users are given a chance to upgrade and make design decisions. Notably, as the governance is in the hand of the network, it has been dubbed that Tezos was designed to evolve.
Tezos also uses the Proof-of-Stake consensus in addition to its Liquid Proof-of-Stake (LPoS) mechanism. Such technical features enable the hodlers of XTZ, the native cryptocurrency on Tezos, to transfer the validation rights of their tokens to other users without necessarily losing ownership.
Polkadot (DOT)
Polkadot is one very significant project in the world of blockchain. The network is joining many other networks to increase safety and scalability. According to data from CoinMarketCap, currently, DOT, the native cryptocurrency of Polkadot, is the 11th largest coin by market capitalization. Notably, although the blockchain is yet under development, its total market cap stands at more than $625.41 billion.
The project has its own interoperability characteristic, which helps join multiple blockchains into a single network. This technology allows all the blockchains to share data among each other without jeopardizing their security.
Polkadot introduced this technology of parachains that helped cryptocurrency users to build their own chains. Notably, the scalability and administration of the Ethereum blockchain are in the hands of this network. For the future of the digital ecosystem, interoperability is one very epochal feature. Interoperability allows products, services, and currencies to migrate across the decentralized Web3.0 environment.
However, experts believe that robust interoperability will open the door to cross-chain alliances, leading to more protocol alliances.
Future of Ethereum blockchain
The developers of the Ether network are working on introducing Ethereum 2.0. The network will shift from Proof-of-Work to Proof-of-Stake. Experts in the industry believe that the transition of the second most popular blockchain will revolutionize the entire digital ecosystem and change the way we see crypto today.
ETH2.0 aims to increase the scalability of the blockchain, enhance the transaction pace, and lower the gas fee to a minimum.
Since the onset of the digital ecosystem, the basis of DeFi is still the Ether blockchain. Notably, precisely 79.23% of the dApps are running on this blockchain, ignoring that the Ether killers are intending for a bigger fraction of the smart contracts and decentralized market.
However, there are some who believes that the processing of transaction and fees are still going to be an issue for the Ether chain. Although the blockchain and other side chains do their best to combat it, it will take years to solve the technical issues.
On the other hand, the pseudonymous community moment and operation supporter of Harvest Finance, Bart, believes that the transition is a step forward in solidifying the original chain and the chain to use. Furthermore, he explained that side chains like Arbitrum or Optimism would continue to grow in strength. Besides, alt-chains that have seen solid growth will also continue to grow even after the transition.
Kadan Stadelmann, the CTO at Komodo, showed some optimistic viewpoints about the transition. He highlighted that the competitors of the blockchain would continue to thrive even after the shift of the network, as they have the major advantage of extremely low gas fees for end-users. Kadan also explained that:
He does not believe that transition alone will lead to an influx of all the projects on Ether until the gas fees are reduced significantly, and all projects adopt Layer-2 solutions. Kadan is expecting a scenario where new projects will continue using alternative networks that offer Layer-1 scalability and Ether Virtual Machine (EVM) compatibility.
Will ETH2.0 kill all Ethereum killer blockchains?
It is difficult for Ether killers to compete or replace the second-largest blockchain in the crypto industry. This is because Ethereum has the advantage of being the first and broadly accepted network. The particular reason is to keep the blockchain at a lead in the industry of smart contracts.
Looking at the data provided by DefiLlama, Ethereum is the largest chain that hosts 504 DeFi protocols and has a whopping $49.2 billion worth of Total Value Locked (TVL). In contracts, the blockchain that is second on the list, Binance Smart Chain (BSC), has a TVL of $6.04 billion with 407 DeFi protocols. The difference of more than 156.29% in TVL shows the hold of Ether in the market. These Ether killers are not a bit close to Ethereum.
Furthermore, one of the most significant enhancements to the transition is yet at stake. The London Hard Fork is the most vital smart contract. DeFi markets are uncertain about falling out of the grasp of the Ether network, as long as the enhancement goes as intended.
But the aforementioned facts do not bring a conclusion that all the competitor chains will vanish in the thin air amid the transition.
Cardano (ADA), Polkadot (DOT), and Binance Smart Chain (BSC) are yet estimated to have the potential to be able to gain further market interest if the shift is impeded any longer, reducing the authority of the ETH market.
While Ether is still one of the favorite solutions among Web3.0 veterans and has a good chance of becoming the widely accepted blockchain, its competitors are offering creative solutions to its shortcomings.
For now, it is a little challenging to conclude what could happen in the future before we see some significant enhancements. But we can say that the development of new dApps and innovations in the decentralized world will drive the search for the right infrastructure to leverage to build the future of the digital ecosystem.