In 2024, two cryptocurrencies are playing a significant role in the competition for dominance in the crypto world: Solana and Sui. Both have the potential to define the next major steps in blockchain technology and are the focus of investors and developers. While Solana has long been considered the “Ethereum killer,” Sui has recently gained significant attention, prompting speculation that it could eclipse Solana. This article provides an in-depth comparison of the two projects, their technologies, funding, tokenomics, and challenges to determine which blockchain has the best chance in 2024.
Founders and funding
Solana was founded in 2017 by Anatoli Yakovenko, a former Qualcomm software engineer. It was originally conceived as a decentralized alternative to centralized exchanges like NASDAQ. Today, however, it is a versatile blockchain that supports decentralized finance (DeFi) and payments. The development of Solana is coordinated by the Solana Foundation, a non-profit organization in Switzerland.
Over the years, Solana has raised around $25 million through initial coin offerings (ICOs) and later an additional $314 million from venture capitalists. This financing demonstrates investors’ strong confidence in the project, even though the collapse of FTX in 2022 led to uncertainty. FTX was one of the largest investors in Solana, which led to a sell-off of Solana tokens after its bankruptcy. However, thanks to takeovers by other investors, the immediate impact on the price of Solana remains moderate.
Sui has its roots in the tech giant Meta (formerly Facebook). Facebook tried to establish its own digital currency system with “Libra” and later “Diem,” but failed due to regulatory hurdles. Shortly before the failure of Diem, the development team split into two groups: one founded the Aptos project, the other developed Sui. Sui was created by Miston Labs, an American software company that benefited greatly from the insights gained from the Meta project.
Sui was able to raise a total of almost $400 million through several rounds of financing. An important aspect here is that Sui was able to successfully buy back the tokens held by FTX after its bankruptcy, which benefits the stability of the project.
Technology and architecture
The technology behind Solana is based on a Proof-of-Stake (PoS) blockchain, which is complemented by the innovative “Proof-of-History” (PoH) technology. This makes it possible to time-stamp transactions and process them in parallel, significantly increasing the speed of the blockchain. Solana claims to be able to process up to 200,000 transactions per second – a figure that is well above most other blockchains. In addition, it has a block time of just 400 milliseconds, making Solana one of the fastest blockchains.
Sui also uses a proof-of-stake blockchain, but with a different approach. It uses the programming language “Move”, which was originally developed by Meta. Unlike many cryptocurrencies, which are account-based, Sui focuses on objects. This object-oriented architecture opens up new possibilities that traditional account-based blockchains do not offer. In tests, Sui was able to process up to 297,000 transactions per second, and its block time of 390 milliseconds is even faster than that of Solana.
Tokenomics and price performance
Solana’s native cryptocurrency, SOL, has a maximum initial supply of 500 million tokens, of which around 60% went to investors, 20% to the team and 20% to the Solana Foundation. SOL’s initial inflation rate was 8%, but this will decrease to 1.5% in the long term. Solana’s early investors have seen impressive returns, with the token price increasing 650x its initial ICO price.
Sui’s native token, SUI, has a max supply of 10 billion tokens, with 50% held in community reserves. The remaining tokens are distributed among investors, the Miston Labs team, and early contributors. Unlike Solana, Sui is still in the early stages of development and there are still many tokens to be unlocked over the next few years. This could affect the price once these tokens come onto the market.
Adoption and usage
Solana has positioned itself as a blockchain for the mass market. Its ease of use and high speed have led to millions of users worldwide using Solana-based applications. The popular Phantom wallet, a browser extension for Solana, has over 4 million downloads. In addition, Solana has made great strides in the DeFi world through partnerships with institutional players such as Visa and, with a Total Value Locked (TVL) of around $5 billion.
Solana TVL Chart
Sui may be younger, but it is already showing impressive numbers. The Sui Scan Explorer shows over 5 million monthly active wallets, reflecting rapid adoption. However, Sui is still lagging behind Solana in the DeFi world, with a TVL of only about $1 billion.
Sui TVL Chart
Nevertheless, Sui users are very active, especially in the area of blockchain-based games.
Comparison
Solana vs. Sui Comparison
Author
Ed Prinz serves as Chairman of https://dltaustria.com, the most renowned non-profit organization in Austria specializing in blockchain technology. DLT Austria is actively involved in the education and promotion of the added value and application possibilities of distributed ledger technology. This is done through educational events, meetups, workshops and open discussions, all in voluntary collaboration with leading industry players.
Disclaimer
This is my personal opinion and not financial advice. For this reason, I cannot guarantee the accuracy of the information in this article. If you are unsure, you should consult a qualified advisor you trust. No guarantees or promises regarding profits are made in this article. All statements in this and other articles are my personal opinion.
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