Why Solana Is a Better Crypto Investment Than Ethereum in 2025
March 5, 2025
Category:
Ethereum
(CRYPTO: ETH)
and
Solana
(CRYPTO: SOL)
are two of the most successful cryptocurrencies, both ranking in the top 10 by market cap. They're also direct competitors. Each is a blockchain platform where developers can build
decentralized apps (dApps)
and launch crypto tokens.
Because Ethereum launched in 2015, five years earlier than
Solana
, it established a big early lead in terms of popularity and usage. But that gap has been closing. Over the last year, Solana's price has risen by 10%, whereas Ethereum's has fallen by over 30%. Here's why Solana is the better crypto investment right now.
Solana is the faster, more efficient blockchain
Ethereum became the top blockchain platform in part because of its first-mover advantage, but going second has its benefits, too. Solana's developers were able to create a blockchain that blows Ethereum away in terms of performance.
According to Solana's live transaction stats, it regularly processes over 4,000 transactions per second (tps). Ethereum is at about 15 tps at the time of this writing. While both blockchains use a proof-of-stake consensus mechanism to validate transactions, Solana combines that with its unique proof-of-history consensus mechanism. Proof of history incorporates timestamps into the validation process, greatly improving processing speeds and costs.
The average transaction fee on Solana is just $0.00025, cheaper than on most other blockchains. Ethereum's median gas fees (its term for transaction fees) are $0.05, but they fluctuate depending on the type of transaction and network congestion.
Solana users are less likely to encounter network congestion since its proof-of-history consensus mechanism makes it so much better at processing transactions. They also pay far less in fees. And based on recent numbers, crypto enthusiasts are taking notice.
Solana's now making more in fees and has higher revenue
At its peak in November 2021, Ethereum earned $1.8 billion in fees, according to DefiLlama. Since then, it has largely been trending downward. More recently, it made roughly $140 million in fees in January of this year and $46 million in February.
Before 2024, Solana was well behind Ethereum in this metric. But it narrowed the gap last year and has been beating Ethereum by a wide margin in 2025, with nearly $250 million in fees in January and over $80 million in February. The Solana team has continually improved with new innovations, including liquid staking in 2024, which allows people to stake their SOL tokens, earn rewards, and receive a liquid staking derivative they can use to earn additional returns.
Fees indicate the amount of activity on a blockchain, so Solana's much larger numbers demonstrate its increasing popularity. Fees aren't the only area where Solana has the edge on Ethereum this year, either. It also had higher revenue numbers in January and February.
Blockchain
January 2025 Revenue
February 2025 Revenue
Solana
$124.2 million
$44.9 million
Ethereum
$109.1 million
$26.2 million
Data source: DefiLlama.
A growing number of people are choosing Solana over Ethereum for their crypto projects. And there's one type of project, in particular, that has taken off recently.
The go-to blockchain for launching meme coins
Meme coins have a controversial reputation in the crypto community. Serious cryptocurrency supporters generally see meme coins as useless at best and pump-and-dump scams at worst. Most of the time, that's accurate.
But even if they serve little purpose, meme coins remain popular. Case in point,
Dogecoin
has a market cap of $35.7 billion. Thanks to its low fees, Solana has become the place to launch meme coins, with
Official Trump
and
Melania Meme
being two of the more famous examples.
There's even a Solana-based platform, Pump.fun, that allows anyone to instantly create a meme coin. It requires very little technical knowledge and costs only about $2 in SOL tokens.
Pump.fun essentially makes launching meme coins on Solana as easy and cheap as possible, and it has been wildly successful. Since March 1, 2024, it has generated over $575 million in fees. And in just the last two weeks, it has had over $2 billion in trading volume.
Ethereum is bigger and more established, but Solana is the better investment
Ethereum has been firmly entrenched as the No. 2 cryptocurrency behind
Bitcoin
(CRYPTO: BTC)
for years. It probably won't lose that position anytime soon. According to a 2024 report by Electric Capital, it's currently the top blockchain platform worldwide by share of overall developers.
But at this stage, Ethereum's a lackluster crypto investment. Fees are declining, it can't handle many transactions per second, and it only recently brought gas fees down to a reasonable level.
Solana, on the other hand, is on the rise. Transactions process quickly and cost just a fraction of what they do on Ethereum. While Ethereum may have the largest share of developers, Solana is second and became the No. 1 blockchain for new developers in 2024. That year, 7,625 new developers explored Solana, compared to 6,456 who explored Ethereum.
On-chain activity for Solana is also picking up, as seen in its fee numbers. Increased activity helped Solana's price hit an all-time high in January, the same month it hit an all-time high in revenue and fees.
Crypto prices, including Solana's, have pulled back since then, which is a normal occurrence. Cryptocurrencies are volatile, so even with quality projects, it's wise to take a cautious approach and be ready for the ups and downs. Choosing the right cryptocurrency investments is also important to give your portfolio the best chance of success. While Ethereum and Solana are both popular choices, Solana has much more going for it as a long-term investment.
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Lyle Daly
has positions in Bitcoin, Ethereum, and Solana. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Solana. The Motley Fool has a
disclosure policy
.
