{"id":2256,"date":"2023-07-31T02:31:16","date_gmt":"2023-07-31T02:31:16","guid":{"rendered":"https:\/\/solanacrypto.news\/2023\/07\/31\/better-buy-cardano-vs-solana\/"},"modified":"2023-07-31T02:31:16","modified_gmt":"2023-07-31T02:31:16","slug":"better-buy-cardano-vs-solana","status":"publish","type":"post","link":"https:\/\/solanacrypto.news\/2023\/07\/31\/better-buy-cardano-vs-solana\/","title":{"rendered":"Better Buy: Cardano vs. Solana"},"content":{"rendered":"
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Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.
Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.
You\u2019re reading a free article with opinions that may differ from The Motley Fool\u2019s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources<\/strong>, and more. Learn More<\/a>
Cryptocurrency valuations have seen some pronounced recovery lately, but the broader crypto market still remains deep in bear market territory \u2014 and many leading tokens are down precipitously from previous highs. Cardano<\/strong>\u2018s (ADA 0.76%<\/span>)<\/span> ADA token is trading down roughly 87% from its peak. Meanwhile, Solana<\/strong>\u2018s (SOL -2.82%<\/span>)<\/span> SOL token is trading off roughly 90% from its high.\u00a0
Which of these cryptocurrencies is the better buy for investors gearing up for crypto\u2019s next bull phase? Read on for a look at pros and cons of investing in each token and a decision on which crypto stands the best chance of delivering explosive gains from current pricing levels.\u00a0
Image source: Getty Images.
Cardano and Solana each provide layer-1 blockchain services and have set up their respective tokens as the fundamental currency for transacting on the networks. To some extent, that puts both projects in competition with Ethereum<\/strong>, which also provides layer-1 blockchain services. It also means that adoption and utilization of Cardano\u2019s and Solana\u2019s respective networks will likely be a driving force in shaping each cryptocurrency\u2019s performance.
Thus far, Cardano\u2019s Ouroboros proof-of-stake<\/a> system has proven to be highly secure. Offering top-tier security is of foundation-level importance when it comes to attracting projects and scaling user engagement in the blockchain space. Due to its network structure and heavy emphasis on security, building and running applications on Cardano<\/a> will typically be slower compared to Solana, which uses a proof-of-history system. Cardano does offer relatively low transaction costs, but transaction costs on the Solana network will usually be even cheaper.\u00a0
While Solana\u2019s speed and transaction-cost advantages potentially make its platform better for long-term scalability, those advantages become less significant if people aren\u2019t confident in the network\u2019s underlying security. Multiple projects on Solana have also suffered significant security breaches, and the network has seen outage periods when it was rendered inaccessible.
While Solana can provide faster transaction speeds and lower costs than Cardano in many instances, thus far, the Cardano network has proven to be more secure and reliable. Offering quick and inexpensive transactions is a desirable characteristic for a layer-1 blockchain network, but security and reliability are paramount.\u00a0
The implosion of controversial cryptocurrency exchange FTX and the fall from grace of its former CEO Sam Bankman-Fried have cast a shadow over Solana. Bankman-Fried had been a major backer of Solana. He purchased large positions in the token through his companies and built projects on its network through his Alameda Research organization. Some have alleged that Bankman-Fried and his companies made moves to artificially increase the price of the SOL token.\u00a0
The connection to Sam Bankman-Fried and FTX has already caused some developers and projects to leave the Solana network. At this stage in the game, when attracting developers and building trust is likely very important to building the foundations of long-term success, a resulting lack of confidence could prove to be devastating.
Making matters worse, much of Solana\u2019s previous activity growth had been a result of it gaining favor as a go-to network for non-fungible token (NFT) projects and transactions. But with NFTs having fallen out of favor, network activity has slumped. Ultimately, I don\u2019t see the NFT market recovering any time in the near future, and the significance these projects held in terms of overall usage on the Solana network doesn\u2019t bode well for the SOL token\u2019s pricing trajectory.\u00a0
Ultimately, I think that Cardano stands out as the much better buy for investors who are aiming to build positions in anticipation of the next crypto bull market. Cardano\u2019s security advantages are the main reason I expect it to be the better performer, but recent events and sentiment shifts surrounding the Solana network also factor into this conclusion.\u00a0
Even more than equity valuations, crypto valuations are heavily sentiment-based, and Solana\u2019s connections to Sam Bankman-Fried and FTX represent a meaningful blemish that could also hurt the project\u2019s underlying fundamentals. The connection to the FTX scandal, whether tertiary or not, already appears to have caused some weakening in support for the Solana network.
It\u2019s highly likely that both tokens will continue to see their pricing action shaped by movements for the crypto market at large, but I think that Cardano\u2019s ADA token looks like the clear-cut better buy at today\u2019s prices.\u00a0\u00a0
Keith Noonan<\/a> has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cardano, Ethereum, and Solana. The Motley Fool has a disclosure policy<\/a>.<\/em>
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Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, […]<\/p>\n","protected":false},"author":1,"featured_media":2257,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2256","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts\/2256","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/comments?post=2256"}],"version-history":[{"count":0,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/posts\/2256\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/media\/2257"}],"wp:attachment":[{"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/media?parent=2256"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/categories?post=2256"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/solanacrypto.news\/wp-json\/wp\/v2\/tags?post=2256"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}