ADA is the 4th largest cryptocurrency in terms of market capitalization of $413.22 billion. Meanwhile, ETH continues to hold its position as Bitcoin’s second with a market cap of $477.42 billion as of December 21.
With Ethereum standing first in the market capitalization, can Cardano be the Ethereum killer, We will discuss it further in the article.
Now, let’s see the advantages and disadvantages of both these cryptos.
Ethereum: Advantages and disadvantages
Ethereum is currently one of the famous names in the crypto world right now, and its native token- Ether, is the second most popular cryptocurrency behind Bitcoin.
The Ethereum blockchain is one of the most widely used for decentralized applications (dApps) such as non-fungible tokens (NFTs) and decentralized finance (DeFi).Hosting of smart contracts, which allow individuals to execute safe and secure agreements without help from a third party such as a lawyer is also possible with Ethereum network.
Since the Ethereum blockchain is open source, anyone can create new dApps. All applications on the Ethereum blockchain require the use of Ether,thus Ethereum will benefited if any of these dApps succeed.
One major drawback of Ethereum is that it is currently using a proof of work (PoW) mining protocol, which is incredibly energy-intensive. Cryptocurrency miners need to use high-powered computers to solve puzzles and verify transactions for this protocol. As time goes on, these puzzles become increasingly difficult, requiring more and more energy.
Ethereum 2.0 is currently under development in which developers are working on transitioning to a proof of stake (PoS) protocol, which is much more environmentally friendly. By using PoS protocol, miners need to put some of their own crypto holdings at stake to get their transactions verified for a chance at earning rewards.
Finally, the PoS protocol also has its downsides. Miners with the most cryptocurrency tokens have the most power when it comes to verifying transactions, so it’s possible that a small number of wealthy individuals could have majority control over the blockchain.
Cardano: advantages and disavantages
As already said, Cardano was created by one of the co-founders of Ethereum, so it shares many similarities with its older competitor. However, it does have some unique advantages and disadvantages.
Just like Ethereum, Users can create dApps on the Cardano network. Some of the projects currently in development include THEOS, an NFT marketplace, and Indigo Protocol, which will allow users to trade real-world assets (such as stocks) on the Cardano blockchain.
Whereas unlike Ethereum, Cardano already makes use of a PoS mining protocol, thus leads the competitor in this way. While it may take months for Ethereum to fully transition to a PoS model, Cardano is already successfully using this type of system.
However, Cardano is still in its infancy, and it might take ample time for it to catch up to Ethereum in other ways.
Ethereum is the first crypto compared to Cardano, so while the two may share many features, Ethereum has a longer track record and is more popular among users right now.
But this doesn’t necessarily mean Cardano will not catch up to Ethereum in the future, though. Cardano has shown tremendous growth over the past year in terms of transaction volume and market capitalization and it is yet to be seen on whether cardano takes an edge over Ethereum.