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Ethereum has an extensive infrastructure that handles most tasks for complex digital agreements and decentralized apps accessed by tech enthusiasts daily. However, Ethereum's monopoly has been challenged, as other blockchain networks have developed ways to match its low speed and scalability.
NOTE: Crypto investments involve significant risk. Do not take the views mentioned here as financial advice. Please conduct thorough research before making any investment.
5 alternatives to Ethereum that exist today
1) Solana
Solana uses a blend of proof-of-history (PoH) and proof-of-stake (PoS) principles to speed up transactions in comparison to ETH.
The PoH confirms that every transaction occurring on the platform bears a cryptographic time stamp. So, the network knows the order in which the transactions happened. Every transaction on the network is slotted automatically, making them super efficient.
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PoS, on the other hand, involves a validator to stake a token to approve a block. As PoS needs no mining event, it is a speedy method. Thus, while Solana, using PoH and PoS in tandem, processes thousands of transactions each second, ETH lags far behind, processing a maximum of only fifteen transactions per second. Therefore, any application in which speed is a critical factor will ultimately choose Solana.
2) Cardano
Cardano has separate layers for processing payment settlements and executing smart contracts. The separation of layers avoids congestions that slow down the transactions. Furthermore, Cardano uses the UTXO model, which allows parallel processing, further speeding up transactions.
Cardano has been based on proof-of-stake (PoS) since the beginning, whereas Ethereum has long been based on the proof-of-work (PoW) principle. Since PoW requires extensive mining, it is an energy-inefficient model. Thus, any party that is to work on sustainable options and faster transactions will naturally switch to Cardano.
3) Avalanche
Avalanche works on multiple chains and not a unified one like ETH. So, there are separate chains for payment settlements and for smart contracts. Furthermore, Avalanche has custom blockchains, which is a huge advantage for games or fintech apps that require customizable rules and no traffic from other apps on the same network.
Hence, it is more suitable for fintech or games apps than Ethereum, whose core blockchain lacks customization ability.
4) Polkadot
Polkadot uses multiple chains for security, coordination, and cross-chain communication purposes. Having a multi-chain network reduces congestion. Moreover, each of Polkadot's parachains carries on parallel processing. In contrast, Ethereum used to process all transactions in a single chain before the release of ETH 2.0, but it now uses bridges for cross-chain communication.
A single chain lowers the transaction speed, and the need for bridges increases the system's vulnerability. Hence, any application that requires a multi-chain network and parallel processing will opt for Polkadot.
5) BNB Smart Chain
BNB Smart Chain uses proof-of-Staked-Authority (PoSA), an amalgamation of proof-of-stake and proof-of-authority, that results in increased transaction speed. BNB Smart Chain employs a limited number of validators, and each of its validators has staked BNB.
The staking of BNB shows their commitment to the validation process. Further, only a few who have proven authority are chosen to be validators. These factors together make BNB Smart Chain transactions faster than Ethereum, which has thousands of validators, which lowers speed.
