The term “Ethereum killer” is gaining traction in the cryptocurrency markets again as the original tokens of several competing blockchain networks provide significant profits during September. For any alternative network to be considered part of this category, it must have a core function that serves as the backbone of the Ethereum network: smart contracts.
With this in mind, the best known market value blockchain networks that typically fall into this space are Cardano (ADA), Solana (SOL), Binance Smart Chain (BSC), Polkadot (DOT), and Terra (LUNA). The original symbols of these networks have been completely destroyed this year. Solana (SOL) recently came under the spotlight after the bulls continued to rally even in the face of a September 8 market sell-off that brought Bitcoin back below $ 50,000.
The SOL price has more than doubled in the past 30 days, but has since retreated from trading around the $ 155 level. The token has reached over 300% in the past 90 days with an extraordinary gain of 7,871.16% YTD. In comparison, this gain overshadows ETH’s growth of 63.77% in 90 days and 385.36% YTD growth. Ethereum’s market value is currently around $ 400 billion, nearly 9 times the solar value of $ 47 billion.
Ethereum kills tokens to win
Several networks have shown promising prospects and profits. Cardano recently completed its hard fork, Alonzo, which launched Plutus-based smart contracts on the network that would enable Decentralized Finance (DeFi) and Web 3.0 applications to be hosted. While ADA’s source code has responded poorly to this milestone in the project’s roadmap, it will still increase this year. ADA is trading at around $ 2.40, up 74.16% over the past 90 days and 1273.86% year-to-date.
Marie Tateboit, marketing manager for Gate.io, a cryptocurrency exchange, explained to Cointelegraph two reasons that led to the start of the Ethereum killer movement. Talking about the lack of scalability of the network, she said: “At first glance, Ethereum is especially slow and can only execute 15-25 transactions per second with very low throughput.”
She also noted that higher demand and lower productivity lead to the next reason – inflated operating fees, which “got a little out of control.” This could affect the ongoing boom in the non-mushroom token (NFT) market. She said, “Do you really want to pay half of ETH in gas taxes just to make a JPEG?”
As such, a Solana Labs spokesperson told Cointelegraph, “Peak NFT mining can be very costly. Recently, coin fees have reached 3 ETH, which is more expensive than many actual NFTs. Solana offers higher speeds and lower prices. … Ethereum, what is really about market share. ”
Another potential Ethereum killer whose coin has performed well this year is Terra. The original LUNA has recorded over 500% gain in the past 90 days and a 5.477% gain since the beginning of the year, and is currently priced at around $ 36.
These big successes often grab attention because of the underlying platform, a technology that attracts more users and expands. Cointelegraph spoke with Lex Sokolin, global co-president of FinTech and chief economist at ConSensys – the blockchain technology company that powers the Ethereum infrastructure – who said:
“DeFi protocols are applications that grow with increasing user base and capital. DeFi is likely to be multipurpose and multipurpose, although Ethereum will still provide the most liquidity. However, expanding and integrating other sources of capital across bridges and stock exchanges is a net boon to the ecosystem. ”
Ethereum is currently undergoing a major transition to Ethereum 2.0 (Eth2), a full-fledged Proof of Stake (PoS) blockchain that has undergone a hard fork in London that brought important updates such as EIP-1559, and the outcome is still actively discussed in society. Cryptocurrencies. Ethereum Improvement Proposal (EIP), which the developers agreed with and the miners demanded a change in the network transaction pricing mechanism.
The change mainly affected the token inflation rate, and the mine’s gas tax revenue is now burned after the upgrade. According to the data, more than 311,300 ETH tokens with a par value of almost $ 1.1 billion were burned. The current burn rate is 2.7 million ETH tokens per year, which will set inflation at 2.3% with an annual release of 5.3 million tokens.
Ethereum is not the only blockchain network implementing this type of pricing mechanism as Solana burns 50% of transaction fees to regulate the provision of SOL tokens. A Solana Labs spokesperson said: “The Ethereum upgrade in London has changed the incentives for miners.