It looks like bitcoin and cryptocurrency prices are ending their worst weekly crypto route since last December, during which the major cryptocurrencies lost $300 billion in combined value.
This week, bitcoin, the world’s #1 cryptocurrency, is up 3.3%. Its nearest competitor by market cap, Ethereum, gained 5.3% in price. Other major cryptocurrencies are also on a tear. BNB is up 9.5%, Cardano 16.2% and Solana 10.6%.
While the entire crypto market is exploding, Bank of America
“Its ability to provide high throughput, low cost and ease of use makes it a blockchain optimized for consumer use cases such as micropayments, DeFi, NFTs, decentralized networks (Web3) and gaming,” Shah said.
The analyst noted that Solana has over 400 successful decentralized projects on its blockchain.
Furthermore, Solana boasts of some of the fastest transaction speeds. Shah explained in the note: “These innovations allow the processing of industry-leading ~65,000 transactions per second with an average transaction fee of $0.00025, while remaining relatively decentralized and secure.”
But they have trade-offs in their wide range of applications and industry-leading transaction speeds.
“Solana prioritizes scalability, but relatively few decentralized and secure blockchains have trade-offs, illustrated by numerous network performance issues since inception… Ethereum prioritizes decentralization and security, but lacks scalability. at a price, which leads to network congestion and transaction duration. Fees that sometimes exceed the value of the transaction being sent,” wrote the analyst, as quoted by coindesk,
Solana was launched in March 2020 as a decentralized blockchain that can host highly scalable applications. According to Alkesh Shah, it is the fifth largest cryptocurrency today – having settled over $50 billion in transactions and minted over 5.7 million NFTs.
Solana is often compared to Ethereum as both support cryptocurrencies smart contract, which are the key building blocks of decentralized applications, such as blockchain-based banks, and NFTs (fungible tokens).
Over the past year, the cryptocurrency has garnered a lot of investor attention and blown the mind of 4,000%. Nevertheless, its size is less than that of its nearest rival, Ethereum. Solana has a market capitalization of $47 billion, which is just over a tenth the size of Ethereum.
The BofA analyst believes that the valuation gap bodes well for Solana. That means its huge potential isn’t fully tied into price just yet. And it gives the cryptocurrency a lot of room to grow as it moves away from Ethereum and other major cryptos by market share.
Stay ahead of crypto trends During this market…
Every day, I tell a story that explains what is driving the crypto markets. subscribe here To receive my analysis and crypto selection in your inbox.