Crypto Research Day 2024: Ethereum vs Solana Debate

Ethereum vs Solana, a Debate

***On 19th September 2024 ​ Superscrypt ,  Ethereal Ventures , and  ANAGRAM hosted the Crypto Research Day in Singapore. At the tail end of the day, we saw one of the spiciest debates of the week between Sreeram Kannan (representing Ethereum) and Lily Liu (representing a resurgent Solana). ***

Below we’ve got you covered with snippets and a TLDR of the lively conversation, but we highly recommend you to go through the full session which we have embedded here.

• On drivers of value in crypto assets: Both Sreeram and Lily agreed that a lot of crypto assets' value is driven by speculation and desire for permission-less access to self-sovereign financial assets. But that's where the common ground ends…

• ETH vs SOL: Programmability or Performance?

  • Sreeram emphasised Ethereum's strengths as "programmable money" with a large "secure interoperability domain" enabled by its rollup-centric roadmap — this composability across L2s will be a key differentiator (i.e. ETH, as a medium for value transfer, can be freely and securely used for different use cases on these ecosystems).

  • On the other hand, Liu highlighted Solana's high-performance architecture that delivers high throughput without the need for L2 scaling solutions. She questioned the assumption that L2s are necessary and described Ethereum’s scaling approach as “constrained optimisation”.

• Approaches to Scaling: Ethereum’s modular, rollup-centric roadmap vs Solana’s integrated base layer

  • Sreeram highlighted Ethereum’s focus on decentralization, pointing to the roadmap that includes mechanisms like danksharding and rollups. He argued that these innovations allow Ethereum to scale horizontally without sacrificing its core principles.

  • In contrast, Lily positioned Solana as prioritising speed and performance at the base layer, allowing it to handle higher throughput and meet the growing demand for blockspace more effectively.

• Fragmentation vs Unified Liquidity:

  • Lily believes that Ethereum’s current L2 ecosystem leads to fragmented liquidity, which in turn disrupts the flow of capital and stifles innovation. She argued that Solana’s unified base layer can better support financial markets by providing a single, high-performance platform.

  • Sreeram acknowledged the liquidity challenges but argued that Ethereum’s modular approach is essential for maintaining decentralization and security, allowing developers to choose how and where they want to scale. He emphasised that Ethereum’s L2s are not the end state but rather a stepping stone towards a more scalable and secure ecosystem.

• Culture and Governance: Decentralization vs. Pragmatism

  • Sreeram painted Ethereum’s development process as being like a “self-enforcing coordination system,” where rough consensus and community-driven decisions build a solid trust layer. It’s not always the easiest path, but he believes it’s the most reliable way to build a truly decentralized network.

  • He argued that Ethereum's base layer serves as a "self-enforcing coordination mechanism", analogous to the U.S. Constitution, that suitably constrains what different actors can do (validators, sequencers, etc).

  • Lily, however, cautioned that Ethereum’s focus on decentralization can sometimes get in the way of growth, as it slows things down and fragments liquidity. Solana, she argued, takes a more balanced approach that helps the ecosystem evolve faster and stay nimble.

The debate between Sreeram and Lily highlighted key differences in the Ethereum and Solana ecosystems, from their technical architectures to their cultures and coordination mechanisms. However, it's important to recognise that both networks, in their own ways, are working towards the shared objective of creating a more open, decentralized, and secure web3 future.

A bit about the hosts…

• Superscrypt is an early-stage web3 fund based in Singapore & New York and founded by Temasek. We focus on infrastructure and emerging applications in web3 and provide comprehensive support to founders building the next wave of disruptive decentralized networks. Learn more here .

• Ethereal funds and supports the growth of early web3 companies and innovators. We invest directly in permissionless networks and partner with the global teams building them at the earliest stages of their journey. Learn more here .

• ​ANAGRAM is a modern institution for a novel technology. We leverage human and financial capital to help bring the ownership economy to the masses. Learn more here. Learn more here .