Bank of America digital asset strategist Alkesh Shah predicted that Ethereum competitor Solana could become the “Visa of the digital asset ecosystem,” in a Jan. 11 research note.
The Solana network was launched in 2020 and has grown into the 5th largest cryptocurrency with a market cap of $47 billion. It is used to settle more than 50 billion transactions. and generated more than 5.7 million NFT tokens.
However, critics argue that its speed comes at the cost of decentralization and reliability, but Shah thinks the benefits outweigh the disadvantages:
“With high throughput capabilities, low cost and ease of optimization for consumer use cases such as micropayments, DeFi, NFT, decentralized networks (Web3), and gaming.”
He went on to say that Solana is taking over Ethereum’s market share due to its low fees, ease of use, and scalability, while Ethereum may be more decentralized and secure. but at the cost of scaling This leads to network congestion and transaction fees that are sometimes greater than the value of the transactions sent.”
But Shah admits, “Solana has shown a number of network performance issues since its inception. including being hit by DDos
Visa processes an average of 1,700 transactions per second (TPS), but the network can theoretically handle at least 24,000 TPS. Ethereum currently handles around 12 TPS on the mainnet (more on the second layer), while Solana has a theoretical limit of 65,000 TPS.
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