Crypto Weekly: In the footsteps of Ethereum

Cardano and Solana follow in the footsteps of Ethereum

Considering the major cryptocurrencies, particularly Cardano and Solana have gained traction in August. From starting the month at $1.34, Cardano has experienced a positive market sentiment sending the cryptocurrency to $2.77. Solana was trading at $36.6 in the beginning of August and is now trading at $99.2. The two cryptocurrencies share the same key property, namely being made to handle decentralized applications with a substantial transaction output. The increasing prices are driven by investors looking at alternatives to Ethereum due to its scalability issues and steep transaction fees. As the Ethereum 2.0 upgrade will first happen somewhat next year, investors are afraid of Ethereum losing its significant first-mover advantages before the update has been launched. With fees averaging between $3 - $8, both developers and users on the network are not pleased, thus imaginably watching other cryptocurrencies to possibly let another network handle their decentralized activities.

Though, the question remaining unanswered is whether other cryptocurrencies over time can match Ethereum’s brand awareness, ecosystem, and more importantly, network effect. Cryptocurrencies wanting to create something similar to Ethereum will encounter the chicken or the egg paradox, as the users are not embracing the network until exchanges and developers have embraced it with e.g., decentralized finance protocols and NFT-marketplaces. However, these network shareholders will not use resources on the network until a substantial number of users are using it.

In terms of Cardano and Solana, Cardano has surged the past month on the news that the cryptocurrency will likely enable smart contracts this coming September, and Solana has surged on a growing institutional interest in the network. As of the time of writing, Cardano is the third - and Solana the eighth-largest cryptocurrency.

Visa, Budweiser, and Stephen Curry buy NFT’s

The market for non-fungible tokens (NFT) has experienced significant growth in the past months with the largest NFT marketplace OpenSea presently generating most transaction fees on Ethereum. On OpenSea, users have traded NFT’s worth $2.84bn the past 30 days. It seems like NFT’s have been the retail crypto-trend of the year comparable to when ICO’s were trending in the latest significant bull run in 2017. Last week two rather well-known companies and one individual joined the NFT-trend by buying their first NFT’s. At the beginning of last week, Visa bought a CryptoPunk, an NFT-based avatar, for $150,000 before sending out a press release stating: “We think NFTs will play an important role in the future of retail, social media, entertainment, and commerce”. Some days after, Budweiser joined Visa by buying a Budweiser NFT made by a fan for around $25,000. This comes after Budweiser bought the Ethereum domain beer.eth for roughly $95,000 earlier this month. Lastly, this weekend NBA star Stephen Curry spend $180,000 for a Bored Ape NFT before sending a selfie into the official Bored Ape Yacht Club community chat.

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