Cardano and Solana are competitors in the decentralized finance (DeFi) and non-fungible token (NFT) space as both blockchains offer smart contract capability that makes the creation of these assets possible. Both of their native cryptocurrencies namely ADA and SOL have also taken a significant beating in the market as the bear market raged on. But once again, the crypto market has begun to see an upside and the question of which is the better investment has arisen once more.
Cardano Vs Solana In DeFi And NFTs
Despite Cardano being the older of the two, the growth of Solana in the DeFi and NFT space quickly surpassed that of the former because it offered smart contract compatibility first. At this point, Solana is playing catch-up to networks such as Ethereum and Solana given that both of these blockchains already had an established community before Cardano debuted smart contract capabilities in September 2021.
At its peak, SOL’s total value locked (TVL) crossed $10 billion compared to ADA’s $326 million peak. Solana is also the second-largest network for NFTs behind Ethereum, a development that has seen the Magic Eden NFT marketplace continue to contend for market share with the notorious OpenSea.
SOL TVL crossed $10 billion at ATH | Source: DeFiLlama
However, Solana was closely tied to FTX and Alameda, both of which imploded in 2022. This negatively affected the sentiment around the network, causing its TVL and NFT trading volume to tank at the same time.
Now, the Solana TVL is sitting at $240 million while Cardano is at $117 million, according to DeFiLlama. This puts both networks in significantly close margins, further narrowing the gap between them performance-wise.
SOL Price Vs ADA Price
As previously stated, the collapse of FTX and Alameda Research greatly impacted Solana, pushing its price down from above $34 to single-digit levels before the market recovery at the beginning of 2023 saw it reclaim the $25 level before falling back down to $19.
In terms of price performance over the last year and how well both digital assets are doing compared to their all-time high values, Cardano emerges as the better option over Solana. Where SOL is down 92.44% from its $259 ATH price, ADA is down 89.42% from its $3.10 ATH, data from Messari shows.
ADA price down over 89% from ATH | Source: ADAUSD on TradingView.com
However, on the flip side of this, both digital assets actually hit their cycle low on the same day this year; January 7. But while ADA is up only 37.32% from its cycle low, SOL is up over 98% from the same day. This highlights the higher interest in Solana, helping to push its value up much more rapidly compared to ADA.
Going by historical data, SOL has been the better performer out of the two and could continue to do so going forward. But it is also important to keep in mind that Cardano has developed a cult-like following, which has proven to be an important factor for well-performing cryptocurrencies, such as Shiba Inu.