Ethereum (ETH +1.31%) remains the second-most valuable cryptocurrency in the world by market capitalization, trailing only Bitcoin (BTC +0.54%). Given Ethereum's dominant position in so many key areas of the blockchain world, it can be hard to imagine any other cryptocurrency ever surpassing it.
But for the past few years, a long line of rivals have attempted to do exactly that. Many of them have been described as "Ethereum killers," due to their superior performance metrics and rapidly growing blockchain ecosystems. And two that particularly stand out right now are Cardano (ADA 0.89%) and Solana (SOL +1.58%). Let's take a closer look at how they might eventually surpass Ethereum over the long haul.
1. Cardano
With a market cap of nearly $9 billion, Cardano ranks as the seventh-largest cryptocurrency in the world. That might sound impressive, but Ethereum has a market cap of almost $200 billion, so Cardano needs to increase in value by a multiple of 20 to 25 just to reach Ethereum's current size. To dwarf Ethereum, Cardano would likely need to 50x in value.
That's a big ask, so it's important that the founder of Cardano, Charles Hoskinson, also happens to be one of the co-founders of Ethereum. If there's anyone who knows how to out-Ethereum Ethereum, it's Hoskinson. He's been very vocal about the structural flaws of Ethereum in the past, arguing that Cardano has superior blockchain technology. This summer, he even suggested that Cardano would eventually surpass Ethereum and Bitcoin to become the top cryptocurrency in the world.
Image source: Getty Images.
From my perspective, it all starts with decentralized finance (DeFi). But in 2021, Cardano upgraded its blockchain to support the smart contracts required for DeFi, and it has continually made new improvements and upgrades since then. This year, for example, Cardano saw the launch of its first stablecoin, as well as a burst of new activity on decentralized exchanges. If Cardano's DeFi ecosystem continues to grow quickly, this could lead to rapid gains in valuation.
Moreover, growth in emerging markets could send Cardano soaring. As Hoskinson outlined in a recent interview, Cardano is looking for blockchain partners across Africa, South America, Asia, and the Middle East. If Cardano becomes the most popular blockchain network in these regions, then it could have a massive impact on its future valuation.
2. Solana
Similar in size to Cardano, Solana has a market cap of $8 billion. So it will need the same types of growth catalysts as Cardano to ever surpass Ethereum. In short, Solana needs a big, think-outside-the-box idea to drive 50-fold valuation gains.
And that big idea might just be mobile crypto. Back in summer 2022, Solana first unveiled its strategic vision for mobile crypto, including a new flagship Android-based mobile device optimized for crypto and a software development kit to help developers around the world build for mobile crypto. It sounded like a lot of hype, but this spring, Solana finally launched its Saga crypto phone. The concept was simple but brilliant: Everything you do on your phone involving crypto should be simple and intuitive, and you should be able to bring crypto with you wherever you go.
CRYPTO: SOL
Key Data Points
The problem is that the collapse of FTX last year had disastrous implications for Solana, which had extensive links to former FTX CEO Sam Bankman-Fried. All the fear, uncertainty, and doubt (FUD) swirling around Solana since the FTX meltdown has taken a toll on the Solana ecosystem. Some high-profile NFT collections, for example, decided to migrate to other blockchains this year, and overall activity on the Solana ecosystem has just started to regain its previous footing. The good news is that Solana is up more than 100% for the year, so the worst may be behind it.
What are the chances of overtaking Ethereum?
For either Cardano or Solana to ever overtake Ethereum, a lot has to go right. The fact that there have been so many purported "Ethereum killers," and none of them have ever managed to unseat Ethereum tells you a lot. The bottom line is that it's very difficult to overtake a market leader with a first-mover advantage, especially within the tech sector.
If forced to choose between Cardano and Solana, I'd pick Solana. This is a crypto that is not just trying to out-Ethereum Ethereum, it's actually proposing a new approach to blockchain technology based around mobile. For me, that's an exciting concept and a big reason why I think Solana might just pull off what many people think is impossible.
