Solana vs Base: Who’s the next bull run bet
Solana and Base have been talk of the town for the past few months. Today, let's take a dive into the key features, strengths and cultures of these two platforms to find out their secrets to success
Introduction
Solana and Base have been talk of the town in the past few months. In contrast to the cooldown of Ethereum onchain activities, Solana and Base experienced a surge in both their ecosystems and user clusters. Due to their superior performance and similar growth path, people always compare these two blockchains to bet on the next bull run ecosystem.
Today, let's give a deep dive into the key features, strengths, and cultures of these two platforms to find out their secrets to success.
What is Solana and Base?
Solana
Solana is a high-performance, open-source blockchain platform designed to host decentralized, scalable applications. Founded in 2017 by Anatoly Yakovenko, Solana is well known for the high transaction speed and ultra low transaction fees compared to other legacy blockchains.
Solana adopts proof-of-history (PoH) consensus mechanism, which uses hashed timestamps to verify when transactions occur. The novel mechanism allows Solana to reach consensus by verifying the passage of time between events, thus significantly reducing the confirmation period.
Base
Different from Solana, Base is built by Coinbase with Optimism’s tech stack as an Ethereum Optimistic Rollup Layer2. It aims to bring the next billions of users to Web3 through the gateway of Coinbase. Launched in August, 2023, Base was getting popular soon afterwards due to its low gas fees, instant transactions, and fortified security backed by Ethereum’s robustness.
Notably, Base offers full EVM compatibility, meaning that it can seamlessly onboard EVM users and developers from Ethereum and other EVM chains. With the bootstrap of Coinbase products integration, Base has quickly become one of the most vibrant Layer2 blockchains.
Blockchain Stats
Transactions Per Second (TPS)
TPS is a measure of the speed at which transactions are processed on blockchain. As of now, Solana's real-time non-vote TPS is around 800 transactions per second, and the maximum recorded TPS is 1,624 transactions per second.
Meanwhile, Base's TPS sits around 30 transactions per second with the maximum recorded TPS being 293 transactions per second. In fact, Base is the leading Layer2 blockchain with the highest TPS over Ethereum mainnet and its peers.
Transaction Fee
According to solanacompass, the average transaction fee paid by Solana's users in the last epoch was 0.000114771 SOL (~$0.018). It’s worth noting that many Solana transactions would have paid the minimum fee of 0.000005 SOL (~$0.0008), but some would have paid more to guarantee priority processing of their transactions, which leads to the increase of average transaction fee.
While on the Base chain, the average transaction fee is around $0.03, which is significantly reduced from $0.49 after the Dencun upgrade in March 2024. As a consequence, Base users are now able to swap tokens or mint NFTs with fees in cents.
Blocktime
Block time is the average amount of time it takes for a new block to be added to a blockchain. The Solana blocktime is around 0.47s, which results in nearly instant confirmation of Solana transactions.
On the other hand, Base operates with a blocktime of 2 seconds. This expedited second-level blocktime empowers Base to execute and confirm transactions at a significantly faster pace than traditional Layer1 blockchains, thereby providing a more seamless experience for end users.
Rewards for Stakers/Validators
Solana operates on a system of staking rewards and inflation. Currently, Solana stakers can earn an average of 7.06% APY yield on their SOL. As for transaction fees, 50% of all fees on Solana are burned. The remaining 50% are sent to the leading validators who proposed the block among the over 1500 validators supporting the Solana network.
On Optimistic Rollup Layer2s, rollup sequencers are responsible for processing and batching together transactions, and submitting those batches to the Ethereum mainnet. They mainly profit from the transaction fees paid by users.
At present, Base is maintained by a single sequencer of Coinbase. Due to the rise of the Base ecosystem, the rollup profits also experienced rapid growth during the last two months. In the last week of March, the Coinbase sequencer generated over $10M of rollup profits, surpassing other rollups combined.
Onchain/Offchain Metrics
TVL and Dapps
The Total Value Locked (TVL) on Solana is approximately $4B, which makes Solana the 4th largest blockchain in terms of TVL among other competitors. It's worth noting that Solana has made a miracle TVL growth from less than $300M to over $4B in one year after the catastrophe of FTX bankruptcy. So far, over 130 protocols have been deployed on the Solana network, ranging from Defi to NFT projects. Check the Solana ecosystem here.
Base is a new player among legacy blockchains. Since the launch in August 2023, Base has captured $1.5B in TVL with exponential growth in March 2024. Base has one of the most vibrant blockchain ecosystems with over 260 protocols deployed on the network. Check the Base ecosystem here.
Ecosystem Developers
According to Electric Capital's developer report, there are 1,615 monthly active developers on Solana, among which 436 are full-time developers. Despite a retracement of newcomer developers, Solana established developers are still in organic growth.
Base has 572 monthly active developers on its network with 189 being full-time developers. Interestingly, due to Base's EVM compatibility, most Base developers are multi-chain and can build easily on Base network. Notably, Base has had an up-trending number of established developers in the last year.
USDC Issuance
Solana is one of the leading blockchains with large USDC issuance. As of now, $2.38B USDC is issued on Solana. This amount accounts for 7.15% of the total USDC supply across all blockchains, which puts Solana a top-tier blockchain with the 3rd largest USDC issuance.
On the other hand, Base is becoming the most popular USDC issuance blockchain. In March 2024, Base garnered significant attention, leading to a substantial increase in USDC issuance on the platform. Consequently, the supply of USDC on Base surpassed that of Solana, elevating Base to the 2nd highest-ranking blockchain in terms of USDC issuance. To date, $2.61B USDC has been issued on Base, accounting for 8.07% of the total USDC supply.
Network Activities
Solana and Base are the most vigorous blockchains during the first half of 2024. The rise of these two new players eclipses other Layer1/2 networks.
Solana experienced the Cambrian Explosion in onchain activities with the momentum of memecoins hype. At present, the daily DEX volume on Solana is around $1.5B (nearly equivalent to that of Ethereum mainnet) and the daily active address surpasses 860,000. Thanks to the high performance of Solana, there are more than 170M transactions executed successfully on Solana every day.
The "onchain summer" also happened on the Base network. Now, there are over 350,000 daily active users on Base, contributing to a total of 2.5M daily onchain transactions. Base DEX volume sits now at $400M daily after the spike to $1.2B at the end of March 2024. Base is thought to be a consumer blockchain to make crypto products cool and fun. NFTs are extremely popular on Base. Till now, the total mint volume on Base is more than 32,000 ETH, which is contributed by nearly 14M NFTs.
Notable Protocols
The innovative protocols contribute to Solana's rebirth and success. Due to its unique tech stacks, revolutionary protocols can be built on Solana and find the market-product fit. Jupiter and Jito stand as exemplary representatives
Only Possible On Solana - Jupiter
Jupiter is a DEX (Decentralized Exchange) aggregator on Solana. It’s designed to help users discover the “best price” in one place. Jupiter offers several options, such as limit order swap, dollar-cost averaging (DCA) and Jupiter Perps, for financial transactions by connecting users with multiple decentralized exchanges on the network. To date, Jupiter processes a total of $$150B worth of crypto assets trades from over 4.3M unique traders.
Only Possible On Solana - Jito
Jito is a liquid staking service for Solana that distributes MEV (Maximum Extractable Value) rewards to holders. It operates a liquid stake pool where users can stake their $SOL tokens in exchange for a liquid stake pool token called JitoSOL. Currently, Jito has a TVL of 10M $SOL and works with over 150 validators to offer stakers 7.65% APY. So far, JitoSOL has become the largest Solana liquid staking token with a marketshare of 49.5%.
Base Onchain Summer - Farcaster
Innovation also emerged like mushrooms after rain on the Base network. Different from its competitors, dapps on Base are less financialized and more fun. For example, Farcaster and Friend Tech are the most popular social platforms on Base.
Farcaster is a decentralized web3 social protocol built with Optimism stacks. It aims to create a censorship-free environment where users have full control over their data and audience. Farcaster has welcomed over 340,000 users since its launch, including notable crypto OGs like Vitalik Buterin and Jesse Pollack. Though Farcaster is not directly built on Base, it thrives the adoption of Base network. Around 80% of Farcaster users transactions are executed on Base network.
Base Onchain Summer - Friend.tech
Friend.tech is a decentralized social media platform built during the Base network genesis period. As a mobile-first dapp, Friend.tech allows anyone on the app to bet on the social worth of other users on the platform, through the purchase of shares of the other user. In the V1 model, Friend.tech amassed more than 900,000 users and generated more than 17K ETH as protocol revenue. Friend.tech V2 was recently launched with 100% of the $Friend token allocated to the community. The $Friend pool is now the 2nd largest liquidity pool on the Base network.
Google Search Index
The Google Search Index is a vast database where Google stores all the information it has gathered from crawling the web. In crypto, the Google search index is the indicator of public interest, as well as reflection of market sentiment.
Solana sentiment has been upward overall since mid 2023. After the Breakpoint conference 2023 and memecoin season, Solana saw a spike in the Google search index, indicating more people were attracted to the Solana ecosystem.
Base shares a similar Google search index trend with Solana. Base blockchain was heavily searched at its launch time and the public interest faded in the following months. However, when the Base summer and memecoin season was ignited, Base also experienced a skyrocketing search index.
Looking Forward
The past 6 months have witnessed the exponential growth of both Solana and Base blockchains. So, what's next? In fact, a few catalysts and milestones are on the way.
Breakpoint and Firedancer on Solana
In the previous year, the Breakpoint conference sparked a surge of interest in Solana. This year, the anticipation is set to continue as the Breakpoint conference 2024 is scheduled for September in Singapore. As a global event, it is expected to draw increased attention and foster a wealth of discussions.
In addition, firedancer, the new Solana validator client, is scheduled in late 2024. It is designed to improve the network’s efficiency and transaction processing capabilities. For example, firedancer is projected to significantly extend Solana’s TPS capacity, potentially reaching a range of 600,000 to 1,000,000 TPS.
Coinbase Smart Wallet and Decentralization of Sequencer on Base
Base also has several milestones coming in the rest of this year. Coinbase smart wallet is a new offering from Coinbase that aims to simplify the onboarding process for users on blockchains. It’s an extension of the Coinbase Wallet SDK, allowing instant creation of wallets within dapps by simply using a passkey. Coinbase smart wallet is highly expected to be the gateway for crypto mass adoption and Base would be an ideal destination for the inflow of new blood.
At the moment, Base has no native token and its sequencer is run by Coinbase. But according to the official website, Base sequencer nodes will be progressively decentralized. This move is expected to enhance the security, stability, and scalability of the Base platform. It’s also part of Base’s ambition to make Layer 2 solutions more accessible, secure, and efficient.
Closing Thoughts
In a nutshell, both Solana and Base offer unique advantages and utilities in the blockchain space. Solana, with its high-speed transaction processing and commitment to decentralization, has established itself as an outstanding player among its competitors. Not only in the DeFi sector, Solana also explores new use cases like decentralized physical infrastructures (DePIN) and compressed NFTs (cNFT) to foster a vibrant ecosystem of developers and dapps.
On the other hand, Base, incubated by Coinbase, brings a fresh perspective to Layer2 solutions for Ethereum and other EVM ecosystems. Its focus on simplifying the onboarding process for users and enhancing the blockchain user experience sets it apart in the dozens of Layer2 blockchains. Base is less financialized as other blockchains, but has more fun and aesthetic on the network. For example, social protocols and artistic collections are apparently more popular on Base than on its peer competitors.
While each blockchain has its advantages and cultures, it's meaningless for users and developers to choose between Solana and Base without a specific scenario. As the blockchain landscape continues to evolve, both Solana and Base are poised to play significant roles in shaping the future of blockchain adoption.
Ending
Kudos to the data gigas for the great dashboards and links: @watermelonCP @growthepie_eth @l2beat @usdc_cool @sealaunch_ @DefiLlama @ElectricCapital @21co__ @jphackworth42 @hildobby_ @andrewhong5297 @pixelhacks @CryptoKoryo @SolanaCompass
If you’re interested in blockchain data analysis, they are must-follow chads on X. 👀
This blog is not financial advice. Please do your own research before investment.
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