Smart contracts are one of the biggest drivers of the growing range of applications of cryptocurrencies. Ethereum remains dominant due to its high decentralisation, but it's losing ground to newer projects in terms of transaction fees and processing time. While Ethereum's throughput doesn't go above 15 transactions per second, the so-called 'Ethereum Killer', Solana, can process 50,000 operations in the same amount of time.

Smart contracts are being actively used in the decentralised finance (DeFi) sector. Ethereum accounted for 97.7% of locked liquidity at the start of the year, although this figure has contracted to 66.7% since then. Solana has the third-most locked liquidity, with $13.3 billion in locked funds and a 5.2% share. This high amount has been achieved in a relatively short time; the main network was only launched in the March of last year. 

Later, Solana also entered the battle for non-fungible tokens (NFTs) used in digital art. The debut happened three months ago when a collection of 10,000 monkeys was sold in 8 minutes. The sale proved the network's fast speed and very low commissions (less than 1 cent). Currently, 193 NFT projects support Solana, and the NFT visuals turnover using this blockchain has exceeded $900 million.

Solana's success has caused a 100-fold growth of its price and pushed the network to fifth place in terms of market capitalisation, with $64 billion. Because of high institutional demand, the cryptocurrency has the third-highest market cap (after Bitcoin and Ethereum) and has been added to Bloomberg Terminal that allows traders to monitor quotes.

Solana is gradually catching up with Ethereum in terms of nodes: 982 nodes against 3,346, respectively. Its improving decentralisation, coupled with low commissions and high transaction processing speed, is increasingly swaying start-ups to choose Solana as their base blockchain.

The StormGain Analytical Group

(a platform for trading, exchanging and safeguarding cryptocurrencies)