Ethereum (ETH) vs Cardano (ADA): What Is The Difference?

Proof-of-Stake (PoS) blockchains are blockchains that rely on validators to stake their crypto assets and help to secure the network. Ethereum and Cardano are two of the top networks in this category.

The two are both networks used for creating smart contracts and building decentralized applications (dApps). They also both support non-fungible tokens (NFTs), and have support for several other projects.

In spite of the similarities, they are also different in more ways than one. In this guide, we compare the two PoS networks to show the differences between the two to help you make a decision on which one to use.

Ethereum is the biggest network for smart contracts and decentralized applications. However, it wasn’t the first PoS network. It launched as a proof-of-work (PoW) network initially, and only recently transitioned to a PoS network.

During the years of its existence, the network has established its reputation as the go-to platform for all things smart contracts and decentralized applications. It has high security and the facilities to support projects.

Unfortunately, the network still faces challenges with scalability, which results in slow transactions and high fees. Because of this, developers and users of NFTs and other services have opted to seek alternative networks which are faster and cheaper.

The network uses ETH or ether as its native token. This is the token used to pay for transaction fees on the network, and is also the token used for staking to secure the network. Validators and other stakers are also rewarded using the same token.

Although there are many requirements to being part of Ethereum governance, holding ether is one of them, so anyone with a certain amount of the token can participate in governance decisions for the network.

There are just a little over 120 million ETH tokens in circulation and this is also the maximum supply since all the tokens are pre-mined. This means all of the tokens that will ever be available are already in circulation.

Many upgrades have been implemented on Ethereum with the hope of correcting the issues with it, but this hasn’t helped much. There are however more proposed upgrades lined up for this year, which will possibly lead to improvements in these metrics.

What Is Cardano (ADA)?

Cardano is another top PoS network, with robust support for smart contracts and dApps. The network focuses a lot on thorough research before proposals for growth are implemented. The founder, Charles Hoskinson believes this is necessary for having a strong network even though the growth may be slower.

Cardano is much more scalable than Ethereum, making it faster and more affordable to use for all purposes compared to Ethereum.

The network uses a unique version of PoS consensus that sets it apart. The network however enjoys the same level of scalability as other PoS networks, and is a great place for smart contracts and building dApps.

You can also use it to buy and trade non-fungible tokens, just like Ethereum. The native token, ADA is used to pay transaction fees and also for staking to secure the network. One of the most important uses of this token however is for governance.

If you hold it, you can vote on proposals for developing the network in the future. The token is also used by investors as an investment asset. Therefore whether you want to participate in the ecosystem or you want a cheap asset, ADA is there.

Just like Ethereum, all the tokens are pre-mined, that is the entire supply is already fully in circulation.

Which Is Better?

Ethereum remains a big force when it comes to smart contracts and dApps because it has built a reputation over many years. However, the unique challenge of scalability is still a challenge.

This makes Cardano a better option for smart contracts and decentralized applications because of its scalability and speed. However, ETH remains a token with better potential than ADA,

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