Five Reasons Why Solana Won’t Replace Ethereum

Author: Mert Source: X, @ryanberckmans Translation: Shan Ouba, Golden Finance

The world's only pillar network will be Ethereum

Ethereum is the core pillar of the new global financial system composed of L2 and L1 applications. No other chain can compare.

Mert put forward the view that Solana can transform into a core pillar, but Solana will never be able to play this role. Here are five reasons.

Four years ago, Ethereum decided to focus on becoming the pillar of the global financial system for L2 and L1 applications. Today, this strategy is gradually being regarded as a top L1 strategy, and even a brilliant decision - although it is still in its early stages, signs are already emerging, such as L2 dominance and all parties scrambling to imitate.

Solana has performed well in terms of speculative and meme coin growth, as well as SOL coin price this quarter. However, I think Solana's leadership has realized that L2 is expected to cannibalize the market share of other L1s, and has tried to suggest that Solana can also transform into a pillar role similar to Ethereum.

But Solana is essentially unsuitable as a pillar of L2, and even L1 applications on a global scale are difficult to support. The reasons will be explained in detail below.

First, let's see how Solana's leadership gradually acknowledged the advantages of Ethereum's L2 core pillar strategy and tried to turn Solana in this direction.

Initially, Solana promoted the "single chain" concept, claiming that its speed and low cost could attract global users to use a single Solana chain. This was their "monolithic" era, that is, the "monolithic" architecture, which later became a burden (because in fact a single structure cannot meet global needs). So they shifted their focus to the word “integration.”

By the middle of this year, Solana acknowledged that L2 was the right direction. Several factors contributed to this change. Solana’s leadership noticed that some flagship applications began to build custom L2 application chains on Sol, mainly because L2 can provide the control and customization that users like, while being part of a larger system and not needing to run consensus on its own. Early on, an important Solana community member posted a hot post about Sol’s need to accept L2, which caused a strong response in the community before Solana’s leadership officially acknowledged that L2 was inevitable. In addition, an important Sol development team also turned to building SVM L2 on Ethereum instead of continuing to develop on Sol L1. These factors prompted Solana’s leadership to gradually lean towards L2.

(It’s important to note that Solana didn’t directly admit that Ethereum’s strategy on L2 has always been correct, instead calling their L2 not L2, but “Network Extensions.” This is a major marketing claim, similar to Sol’s recent “True TPS” concept. Because Sol included 80% of the consensus overhead in its TPS data on many information sites for many years, many sites still show Sol’s TPS as 3,000, but the real data is about 750 TPS. Solana invented “True TPS” to correct this long-standing misleading practice. Therefore, professionals who do due diligence seriously need to be cautious about Solana’s claims - many of them don’t stand up to scrutiny.)

This month, Solana’s leadership began discussing how to transform into a pillar strategy for Ethereum (but as shown below, they can’t achieve this).

So why is Solana now supporting Ethereum’s pillar strategy? Why now?

The reason is that global demand for a large number of new chains is emerging (thousands or even tens of thousands), and L2 has advantages over alternative L1 in general. This is why companies such as Coinbase, Kraken, Sony, EVE Online, etc. have chosen L2, so becoming an L2 pillar is a top-level strategy.

So can Solana simply transform into a pillar? No, because this strategy is not feasible for Solana (see below for reasons).

In fact, Solana faces a profound dilemma in terms of technology and economic strategy.

What exactly is Solana facing?

• Solana cannot meet even a small fraction of future global demand quickly or cheaply enough.

• Solana is not decentralized enough to attract truly large capital.

• Solana cannot serve as a globally competitive L2 backbone.

• Solana bundles consensus and execution together, which is slower and more expensive than execution alone. This is why the most scalable L2s that only require execution and no consensus, while benefiting from the network effects of trustless composability across L2s, will be faster and cheaper than Solana in the future. See MegaETH.

This is crucial, not only will Solana not be a backbone, but it will not even be the fastest or cheapest chain in the future.

Right now, to some people (including many investors), Solana may appear to be "all things to all people" - it seems to be an upgraded version of Ethereum. But this is far from the truth. Before long, Solana will be nothing on a technical and economic level.

While ETH may have lost to BTC and SOL in terms of ratios this season (the season is not over yet), Ethereum is playing chess, not simply making a move. Ethereum is poised to win the “battle” to achieve global adoption of on-chain applications because it scales in a way that is consistent with how the world actually works — through an L1 pillar and L2 markets.

In short, Ethereum has been right all along, and its strategy as a pillar far outperforms all L1 strategies. While Solana’s leadership may hint that they can also be a pillar, they can’t.

5 Reasons Why Solana Will Never Become a Global Pillar Network

1. Solana lacks true client diversity and it is difficult to achieve in the short term.

Client diversity means that the blockchain is run by multiple independent programs at the same time, which effectively prevents attacks (through multiple independent development teams and programming languages) and accidents (multiple code bases can limit bugs to a single code base). Client diversity is a basic requirement for the global backbone network.

To achieve client diversity, you cannot rely on a single program to run the majority of validators' stake. Usually at least three independent chain clients are required, with a balanced stake distribution between them. A protocol specification and upstream research community are also required to ensure that all clients are running towards the same clear goal.

Currently Solana has only one production client (agave rust), and is trying to develop a second client (firedancer), but due to the lack of a real protocol specification and research community, development is slow. The high degree of optimization of the Agave rust client and the deep integration of the underlying hardware also make it more difficult to extract and reimplement the protocol specification.

Firedancer is not yet ready to run 50% of the stake in the production environment. Even if it is successfully launched, Solana will need to develop a third production client and maintain a balance of interests between the three to achieve true client diversity. Each client must be an independent code base, with no code overlap, overlapping development teams, or code dependencies, and in different programming languages.

Ethereum currently has four production clients that meet these standards and have been maintained for many years.

2. High bandwidth requirements

The Solana chain requires very high bandwidth (10Gbps upload is recommended), which significantly increases the difficulty and risk of decentralization.

The purpose of the global pillar network is to minimize risks, and high bandwidth requirements undoubtedly increase the burden. Although large-capacity computers can be set up in specific locations, it is difficult to obtain 10Gbps upload speeds in many areas, especially without a company data center or VPN.

The global pillar must be able to run almost anywhere. In the future, the need for data centers can even be avoided entirely, and the 10Gbps upload requirement makes it difficult for Solana to meet this requirement, and Solana's bandwidth problems will only become more serious over time.

3. High risk of future outages

Solana has been shut down many times, but unlike Ethereum, it lacks a protocol-level fallback mechanism to continue generating blocks when it cannot be "terminated".

When the global backbone network supports tens of trillions of dollars in assets and is relied on by more than 200 countries around the world, it is crucial to ensure that the network does not shut down.

4. Lack of economic decentralization

Solana sold less than 2% of SOL tokens publicly in the early stage, and the remaining nearly 98% were allocated internally.

In contrast, Ethereum sold 80% of its tokens publicly and distributed ETH widely among miners through a seven-year high inflation PoW model.

Solana is highly centralized at the economic and operational level, which increases risk and weakens its applicability as a global backbone network.

5. Zk proof aggregation technology allows global pillars to not sacrifice decentralization for scalability

Ethereum L1 intentionally does not focus on execution scalability, but due to zk aggregation, all L2/L3 and even hundreds of thousands of chains in the world can complete settlement on Ethereum.

Solana focuses on L1 execution scalability, which is a disadvantage for the global backbone network to maximize decentralization and neutrality.

For the reasons above, Solana will never be able to become the backbone of the new global financial system.

In my opinion, Solana will have difficulty maintaining even the role of "a" backbone, and its market share will decrease year by year, especially when Ethereum (L1+L2) continues to lead in key areas such as non-native application capital and large enterprise integration. The world generally prefers Ethereum L2 or L1 to Solana or other chains, and existing and upcoming companies and governments such as Coinbase, Kraken, Sony, Visa, and the City of Buenos Aires have also confirmed this.

Any company or government that seriously considers blockchain will find the above mentioned problems during due diligence.

Ethereum is the backbone network of the new global financial system, and no other chain can compare, including Solana. L2 is destroying the market share of other L1s and allocating ETH as an asset, and the value of ETH will increase significantly as a result.