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Ethereum, the crypto platform second only to Bitcoin, is known for its native cryptocurrency, Ether (ETH) — which we reported on in our ‘Ethereum Forecast’ as hitting a high of $3,825 last February. It’s also lauded for its sophisticated blockchain network, which is considered "Turing-complete" and therefore capable of performing most computational tasks. These include running decentralized applications, executing smart contracts, and creating NFTs.

Though Ethereum is currently considered the leader in these use cases, its competitors are closely studying its flaws to provide better services for their users. As they close in, many speculators are wondering if it's just a matter of time before these "Ethereum killers" take away its first-mover advantage. Below are just some of the competitors to keep an eye on this year.

 

Solana
Ethereum 2.0 runs on a proof-of-stake (PoS) model, meaning a user can only validate as much data on the blockchain as is proportional to the amount of ETH they hold. PoS is faster, cheaper, and more energy-efficient than Ethereum 1.0 and Bitcoin's proof-of-work (PoW) protocol, which involves verifying additions to the blockchain by measuring the amount of computing power expended to mine them. However, PoS doesn't provide as much security.

Solana remedies this with a proof-of-history (PoH) model. Its founder and CEO Anatoly Yakovenko explains that this involves cryptographically verifying the time a specific entry is made in the blockchain. It can thus verify transactions faster — 50,000 transactions per second (TPS) versus Ethereum's 13 to 15 — without compromising security or scalability.

 

Polygon
Being the first blockchain to support smart contracts, Ethereum's infrastructure now has difficulty handling increasing demand. It’s now sluggish with its aforementioned 15 TPS. Transaction fees are also exorbitant at $60 per token swap and hundreds of dollars more for minting NFTs.

This is why more investors are looking to buy Polygon, as it is a scaling solution that aims to solve these issues. This cryptocurrency unburdens Ethereum of excess demand by collecting transactions by the batch and processing them as a single transaction on the Ethereum blockchain. With this, it hopes to make transactions quicker and more cost-effective.

 

Cardano
Ethereum 1.0 runs on a PoW model and uses as much electricity as the whole of Libya — and its carbon footprint is equally large. Though Ethereum 2.0 is supposedly more eco-friendly, University College London still cited it as the biggest PoS energy consumer in its 2021 report DLT Environmental Impact.

Cardano is therefore proud of its ability to validate transactions without the environmental costs. Its blockchain is split into a settlement layer that acts as a ledger and a dedicated computing layer. This allows Cardano's PoS protocols to eliminate crypto mining and facilitate the validation of 1 million TPS. Today, it’s nicknamed “the green blockchain.”

 

Polkadot
Ethereum primarily runs smart contracts, which allows for various use cases like decentralized apps and NFT minting. As discussed above, though, its inability to scale has impacted the quality of its services. Polkadot is one blockchain that makes up for all that and more.

In fact, Polkadot is quite similar to Ethereum 2.0 with one extra feature: interoperability. It connects multiple blockchains within a single network, playing perfectly into the blockchain's core value of decentralization without compromising security. By providing the same basic functions as Ethereum with added opportunities for cross-blockchain collaboration, Polkadot is already poised to reduce Ethereum's relevance in the industry.

Ethereum will always be a pioneer in blockchain technology. However, its competitors are catching up — making it clear that it has to bring something new to the table if they want to stay in the game.