A Cryptocurrency Bank of America Bets On, Not Bitcoin By Investing.com


Home »Economy» America’s Cryptocurrency Bank Bets on Bitcoin, Not Bitcoin By Investing.com Jan 13, 2022

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Investing.com – While many crypto experts and financial institutions are betting on the biggest, the new digital day could become or even rival the dollar.

The world’s largest financial institution Bank of America is betting on one of the fastest growing altcoins in the cryptocurrency market.

Visa (NYSE: Cryptocurrency)

Bank of America predicts that the digital currency may be the cryptocurrency Visa, which indicates that it could be the new payment future.

It is on the cusp of capturing market share, given its advantages of low transaction fees, scalability, and ease of use, said a strategist at Bank of America (NYSE).

Alkesh Shah, digital asset strategist at Bank of America, predicted Solana would become a competitor to Ethereum Visa for the digital asset ecosystem in a recent research note.

Solana

The Solana Network was launched in 2020, the asset analyst says, and has since grown to become the fifth largest cryptocurrency with a market capitalization of 47 billion.

Solana’s trading volumes are growing faster than Ethereum, which has been used to settle more than 50 billion transactions and more than 5.7 million non-fungible tokens (NFTs).

However, critics argue that its speed comes at the expense of decentralization and reliability, but Alkesh Shah, a digital asset strategist at Bank of America, thinks otherwise.

The benefits outweigh the drawbacks

“Its ability to provide high throughput, low cost, and ease of use creates a blockchain optimized for consumer use cases such as micropayments, DeFi, NFT, decentralized networking (Web3) and gaming,” says Shah.

Shah went on to suggest that Solana takes a significant portion of the Ethereum market share due to its low fees, ease of use, and scalability while Ethereum may be migrated to “high-value transactions, identity, storage, and supply chain use.”

“Ethereum prioritizes decentralization and security, but at the expense of scalability, which has resulted in periods of network congestion and transaction fees that are sometimes greater than the value of the transaction being sent,” Shah said.

Visa

“Visa processes an average of 1,700 transactions per second (TPS), but the Solana network can theoretically handle at least 24,000 TPS,” Shah says.

Ethereum currently handles around 12 TPS on the mainnet (more on the dual layer), while Solana boasts a theoretical limit of 65,000 TPS.

Shah acknowledges that “Solana prioritizes scalability, but a less decentralized and relatively secure blockchain has trade-offs, as evidenced by several network performance issues from the start.”

baffles

Solana has proven more than its fair share of network performance issues over the past months.

For example, Binance recently confirmed withdrawal issues on January 12, and reports of delayed performance via social media on January 7.

Besides what appeared to be a DDos attack on January 5, although Solana denied that was the case.

This came less than a month after an earlier attack on December 10, with reports of network congestion due to mass mobilization linked to the December Initial Offer (IDO) on Solana’s decentralized exchange platform, Raydium.

Austin Federa, head of communications at Solana Labs, said developers are currently working to address network issues, specifically in terms of improving transaction scaling.

Expectations

When asked if he was concerned that there were too many good competitors, Raoul Pal, former CEO of Goldman Sachs said:

“I don’t care, of course the dominance of Ethereum like the dominance of Bitcoin would collapse over time because new technology is constantly evolving so that the dominance of Bitcoin ends, and so does the dominance of Ethereum and then Solana.”

When asked why he invested so heavily in Ethereum if he thinks his dominance on the blockchain will decline at some point, Pal said:

“I think Solana will beat Ethereum later in the next round.. I split my money between all of those.”

Regarding Solana’s heights, Pal said, “Solana is just like Ethereum as it was in 2017, and predicted Solana’s price would reach $2,000 in current dollars.”

Solana now

Solana rose during those moments of writing the report within the limits of 4% to reach levels of $154, while it succeeded in transforming within a week from the decline to the rise by 3.5%.

Solana’s market capitalization is about $48 billion, and it ranks fifth among digital currencies in terms of market capitalization, while it has decreased by 14% since the beginning of this year.

On the other hand, from Solana’s highs, Ethereum falls during those moments by about 2%, all the way to the levels of $3.3 thousand, while its market capitalization is about 401 billion dollars.

The fate of digital currencies amid volatility:

The article does not express a recommendation or recommendation, but merely an observation of market fluctuations, since trading in digital currencies involves high risks, including the risk of losing some or all of the investment amount, knowing that it is not entirely subject to financial conditions. authorities and markets.