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Blockchain technology has been disrupting the financial world for many years, and its applications extend to accounting, auditing, peer-to-peer transactions, gaming, supply chain management, real estate and more. These and other uses are supported through the secure and private transactions that blockchains process, but these blockchains vary in bold ways. One of the more notable and established blockchains is Ethereum, but Ethereum’s reign is being challenged by others touted as “Ethereum killers.”
Key Takeaways:
Ethereum is among the leading blockchains in use today. While it has slow transaction processing times and high gas fees, the blockchain will be undergoing a series of upgrades in the near future to improve on these issues.
An Ethereum killer is a blockchain that addresses the known challenges of Ethereum and attempts to eventually replace it in the crypto market.
Bybit offers various trading products for ETH and the top ETH killers. Find out more about how you can trade them in this article.
Ethereum is among the leading blockchains in use today, often taking a backseat only to Bitcoin. It uses open-source software and is a decentralized blockchain functioning with smart contracts.
The Ethereum blockchain is the brainchild of Vitalik Buterin. It was launched in July 2015. It currently has more than 11,900 active nodes. Recently, Ethereum completed its transition from a proof of work (PoW) system to a proof of stake (PoS) system in what has been dubbed the Merge. Among other things, the Merge has successfully reduced the blockchain’s energy consumption by more than 99%.
There’s an unlimited max supply of Ethereum tokens (ETH). As of Apr 4, 2023, ETH is valued at $1,812.99, and its market cap is $218.60 billion. Some of Ethereum's shortcomings are slow transaction processing times and high gas fees. However, it excels in security.
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An ETH killer is usually a Layer 1 blockchain that has been created as a replacement for Ethereum. To be termed an Ethereum killer, the blockchain has to specifically address Ethereum’s known challenges with the goal of eventually replacing Ethereum in the crypto market.
The Ethereum development team is attempting to overcome Ethereum's shortcomings through a series of upgrades. However, these upgrades have been slow in coming, so ETH killers are taking advantage of the lengthy timeline and are jockeying for a top position in the crypto market. Most ETH killers offer improved transaction processing times and much lower fees.
However, ETH killers are unique in their features and functionality. While ETH killers often receive ample attention at the outset, none have yet been successful in their attempts to dethrone the Ethereum ecosystem.
ETH killers are decentralized finance (DeFi) ecosystems that have generally been designed as Layer 1 platforms, although some Layer 2 solutions can be considered ETH killers as well. While they all share some similarities with the Ethereum ecosystem, they also have standout traits and features that give them strategic advantages over Ethereum. Many of the top ETH killers today have been active for years and are relatively popular, but it remains to be seen if any of them will one day supercede the Ethereum blockchain.
When Solana launched as an alternative to Ethereum, it stood out with greater efficiency due to its proof-of-history consensus mechanism. This is similar to the PoS protocol, but it uses time stamping to facilitate faster processing times. In fact, it’s capable of processing more than 4,000 transactions per second. According to Etherscan, Ethereum can only process 13.2 transactions per second (TPS). Solana also has substantially lower fees than Ethereum.
Currently, Solana is predominantly used for NFTs and gaming. In fact, it takes second place to Ethereum with an NFT sales volume of $4.46 million, which is more than four times lower than that of Ethereum. As of Apr 4, 2023, the current market cap of SOL is $7.95 billion. Solana suffered considerably due to the recent FTX exchange collapse, but it maintains fundamental strength. Looking forward, Solana will be focusing on launching a web3 mobile phone for its users’ benefit.
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Another popular Ethereum killer is Polkadot, which uses a PoS protocol. At a speed of 1,000 TPS, Polkadot isn’t faster than Solana. However, it surpasses Ethereum in actual speed. Polkadot functions with a heterogeneous, multi-chain architecture, which enables several chains to exist on one relay chain. This architecture bolsters the security of the blockchain and enhances scalability. In addition, developers can create parachains, which are their own blockchains. As of Apr 4, 2023, DOT’s market cap is $7.83 billion.
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Polygon launched in 2017 and is a Layer 2 solution that uses the Ethereum blockchain. However, its platform provides users with higher scalability and flexibility and lower transaction fees. It also gives users the ability to own their blockchains, while also offering the security and other benefits of Ethereum. In addition, Polygon facilitates communications between various blockchains, including Ethereum. As of Apr 4, 2023, MATIC’s market cap is $10 billion.
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Cardano is an ETH killer that uniquely uses the Ouroboros mechanism, which allows it to process a greater number of transactions than the Ethereum blockchain can handle. In addition, Cardano supports smart contract functions as well as DeFi projects.
Cardano’s blockchain launched in 2017, benefiting from its Alonzo upgrade in 2021 and subsequent Vasil hard fork upgrade in 2022. The former upgrade allows for improved programming so that the Cardano blockchain is more suitable for NFTs and smart contract projects, while the latter upgrade allows Cardano to become more robust and scalable to improve the overall functionality of the blockchain. Cardano also uses a peer review system for quality control after upgrades are made. This blockchain can execute up to 250 TPS, and its market cap is $13.69 billion as of Apr 4, 2023.
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Avalanche is another PoS Ethereum killer. It uniquely integrates three interoperable blockchains together, giving it greater scalability than the Ethereum blockchain and other ETH killers. Currently (as of Apr 4, 2023) its market cap is $5.6 billion.
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When EOS.IO launched in 2017, it was compatible with both smart contracts and decentralized apps (DApps). Uniquely, its user-friendly design enables developers to create and scale projects without an extensive amount of coding and technical expertise. Developers have free access to a wide range of tools.
EOS.IO has no transaction fees, and a half-second block time. This blockchain uses specialized software that makes it adaptable, scalable and fast. In addition to its software, EOS.IO operates with a delegated proof of stake (DPoS) mechanism. It features a rewards mechanism for validators that uses newly minted tokens, and it functions with decentralized governance. The market cap for the EOS token as of Apr 4, 2023 is $1.3 billion.
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Tezos utilizes both PoS and liquid proof of stake (LPoS) mechanisms that differentiate it from the Ethereum blockchain. In addition, it’s self-governed, which places its users at the helm when deciding which upgrades to make going forward. Tezos also supports DeFi and NFT projects.
Its utility has yielded notable projects in art, gaming, music and fashion in recent years. In addition, this blockchain is widely recognized by developers for its enhanced security. Tezos operates with community governance, so voting rights are granted to token holders. As of Apr 4, 2023, its market cap is $1.04 billion.
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Fantom is different from other ETH killers in its use of a directed acyclic graph (DAG) network. DAG is a superior variation of the PoS mechanism used by Ethereum in that it’s more efficient, has lower fees and offers enhanced scalability. Other DeFi projects can be built on this Layer 1 platform. FTM’s market cap as of Apr 4, 2023 is $1.24 billion.
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Stellar is an open-source network that’s specifically designed to store, create and send all types of money in their digital formats. It uses a digital ledger to support micropayments, global payments and asset exchanges. Its ledger is updated every five seconds or less. Stellar can process 200 TPS. The Federated Byzantine Agreement (FBA) protocol used by Stellar supports cheaper, faster and more energy-efficient transactions as compared to Ethereum. As of Apr 4, 2023, XLM’s market cap is $2.83 billion.
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The NEAR Protocol is a unique network that’s well-known for its Rainbow Bridge technology, which enables ETH token holders to operate on both the Ethereum and NEAR chains. NEAR Protocol is an open-source, PoS project that’s centered around smart contracts. Compared to Ethereum, NEAR’s fees are 10 times lower. This platform also stands out because of its commitment to its community, and to the creation of more developer applications. The market cap for NEAR is $1.7 billion as of Apr 4, 2023.
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There are many ETH killers in existence today. Each one attempts to be a better alternative to Ethereum. While these other blockchains have collectively taken a sizable chunk of the crypto market share away from Ethereum, Ethereum continues to hold a substantial amount of the blockchain share compared to any other single platform.
As is the case with Ethereum, ETH killers have planned upgrades that will raise their appeal further. These upgrades could draw more attention away from Ethereum, and other ETH killers will likely arrive on the scene to further fracture the market share. With this in mind, it may be increasingly challenging for any single blockchain to be as dominant as Ethereum once was. It’s reasonable to speculate that there may continue to be multiple DeFi and NFT blockchains, each with its standout traits and benefits.
While Ethereum has maintained its edge over other blockchains thus far, it has been negatively impacted by this competition in the crypto market. As of August 2020, Ethereum dominated the DeFi space with 94.9% of activity. By May 2021, this had declined dramatically to roughly 64%.
ETH killers currently have strategic advantages over Ethereum, such as greater scalability, faster transaction speeds and cheaper costs. Until these issues have been addressed through planned Ethereum upgrades, ETH killers will likely continue to gain a greater share of the market. Even if Ethereum’s upgrades put it on par with ETH killers in these key areas, it’s not clear if Ethereum will be able to build up its market share to its previous level.
However, Ethereum does have an edge over the ETH killers in a critical area: While ETH killers have achieved superior scalability and speed by prioritizing these factors over security and decentralization, the result has been impugned security and performance. Ultimately, the blockchain network that’s able to address all of these issues properly will likely rise to the top.
ETH killers have gained ample attention in recent years because of various advantages, creating the potential to dethrone Ethereum. At the same time, however, even the top Ethereum killers have their own downfalls. It’s unlikely that any specific blockchain will consume the vast majority of the market share that Ethereum once did. With this in mind, ETH killers simply offer more options for developers and users to choose from.
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