Experts weigh in on struggling crypto project — here's why some still believe in its potential
Solana, also known as the "Ethereum killer," has grown in popularity, though perhaps not enough to live up to its nickname.
Green Matters reported that the Solana platform can process 65,000 transactions a second, which is 2,600 times faster than Ethereum. Solana's average transaction fee is also less than 1 cent USD, while Ethereum's lands between $10 and $50 USD.
Despite the strengths of Solana, its token's exchange rate is 1 solana for $127.21 USD as of this writing. By contrast, 1 ether — the native cryptocurrency on Ethereum — equals $1,946.40 USD as of this writing, per Binance.
However, exchange rates have dramatically decreased since Green Matters published its article on Feb. 10; 1 solana and 1 ether equated to about $220 USD and about $3,550 USD, respectively, at that time.
Both pale in comparison to bitcoin, of course, which is at $82,824.42 as of this writing after experiencing a similar drop over the last month, having traded at $98,333.22 on Feb. 10 and going for over $100,000 at times in December and January.
Fast Company attributed this drop to cryptocurrency investors experiencing "macroeconomic uncertainty." This feeling has been spurred by the slew of tariffs the U.S. is imposing on Canada, Mexico, China, and many other countries.
At the very least, the Solana platform has the potential to be more eco-friendly than other forms of cryptocurrency because it uses a "proof-of-history" consensus mechanism, which doesn't require mining. Ethereum is not far behind, as it completed "The Merge" in 2022 to switch to proof-of-stake, cutting its energy use by over 99% compared with proof-of-work.
Solana may also be a viable alternative to Ethereum as two of the more eco-friendly options in terms of nonfungible token minting, which generally requires a lot of energy and can lead to e-waste, according to Investopedia, especially if a blockchain such as bitcoin is used. That said, proponents of proof-of-work, which bitcoin uses, say it's more secure and more decentralized.
On top of that, many mining facilities have been switching to clean, renewable energy or using only excess energy that would otherwise go to waste, along with helping fund the clean energy transition by making it more profitable, which is a big step in the right direction for cleaning up crypto's reputation as an energy hog.
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But there are still other issues to tackle, as not all cryptocurrency miners are as forward-thinking as the smart ones investing in cleaner energy that saves money in the long run. Many areas have had to deal with threats of energy grid collapses and increased e-waste as a result of more opportunistic miners. With that in mind, diversity in the cryptocurrency market — with some offering lower-energy, lower-fee alternatives, as Solana and Ethereum have been doing — should continue to be healthy in the pursuit of a cleaner future for crypto.
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