NFT Blockchains Other Than Ethereum
Ethereum is not the only available NFT blockchain. At least 10 of the top 50 cryptocurrencies are hosted on NFT-compatible blockchains. Solana, Cardano and Binance Smart Chain are all more affordable alternatives, although each differs regarding the minting, buying and selling of NFTs.
How Do NFTs Use Blockchain?
Non-fungible tokens are digital assets that can represent a range of products. This includes art, in-game items and other forms of media. Real-world assets, like real estate, can also be tokenized using blockchain technology.
NFTs are unique cryptographic tokens, whose proof-of-ownership exists on the blockchain and cannot be replicated. Tokenising assets makes transacting them simpler and potentially safer. Using blockchains also helps to remove third-party intermediaries, in the interest of decentralisation.
Why is Ethereum the Most Popular Blockchain for NFTs?
Ethereum helped to popularise the concept of non-fungible tokens, thanks to the introduction of the ERC-721 token standard. ERC-721 tokens can have different properties to one another, even when existing on the same smart contract. Furthermore, the following ERC-1155 token standard helped to reduce transaction and storage costs for NFTs. ERC-1155 tokens also enabled developers to batch different types of non-fungible tokens into a single contract.
In addition to its early positioning within the NFT space, Ethereum also has a number of advantages with regards to NFTs. The blockchain is highly-secure and has already experienced mass-adoption. This provides NFT developers and creators with greater exposure compared to competitor blockchains. Developers are also able to take advantage of Ethereum’s huge infrastructure and extensive offering of development tools. This makes the Ethereum blockchain an obvious candidate for non-fungible token creation.
What Are the Different NFT Blockchains?
Despite the clear benefits of using Ethereum for NFTs, the network does also have a number of drawbacks. The greater the demand for transactions on Ethereum, the higher the fees required. This means that many retail investors simply can’t afford to mint or purchase NFTs on the Ethereum blockchain. Thankfully, there are a number of alternatives, a non-exhaustive list of which can be found below.
Solana is arguably the second-biggest NFT platform, after Ethereum. It is sometimes referred to lovingly as an ‘Ethereum-killer’, and is a top 10 cryptocurrency that provides faster and cheaper transactions than its rival.
Solana is a public, open-source blockchain built to host a range of decentralised applications (dApps). Developed in 2017 by Anatoly Yakovenko, Solana utilises a combination of proof-of-stake (PoS) and proof-of-history (PoH) consensus mechanisms. This PoS and PoH combination helps to solve the blockchain trilemma: decentralization, scalability and security. The Solana network uses SOL, its native cryptocurrency, and much like Ethereum, supports smart contracts. These smart contracts allow for the creation and trading of NFTs.
- Fast transactions: Solana is one of the fastest networks in DeFi. It is capable of processing tens-of-thousands of transactions per second. This impressive network speed is hugely beneficial when minting and transacting non-fungible tokens.
- Low fees: Solana offers fees of just $0.00025 per transaction. This allows users to mint several NFTs for a fraction of the cost of Ethereum.
- Minimal environmental impact: Solana doesn’t use the proof-of-work consensus mechanism employed by Bitcoin – and Ethereum, previously. This makes it much less harmful for the environment. Energy usage is one of the biggest criticisms of NFTs, so using a greener alternative, like Solana, is advantageous.
- Network stability: Solana lacks Ethereum’s network stability. It has experienced several network outages and occasional slowdowns in recent months and years, including a six-day shutdown in January 2022. This lack of reliability is less than ideal when trying to mint or purchase NFTs.
- Fewer projects: Despite a significant growth in popularity, Solana lacks the project depth that Ethereum has. Although Solana boasts projects like DeGods, Okay Bears and Degenerate Ape Academy, these don’t really compare (in scope) to Ethereum’s CryptoPunks and Bored Ape Yacht Club, for example. Solana’s projects also don’t have the celebrity backing witnessed by some of Ethereum’s biggest collections.
- Decentralisation issues: Solana is less decentralised than some alternatives. It relies heavily upon the Solana Foundation, who have a large share of ownership, and therefore control, over the network. Decentralisation is a priority amongst Web3 users, so this could be problematic for new investors.
Cardano is a layer 1 blockchain, launched in 2017 by Ethereum co-founder, Charles Hoskinson. Although it has a significantly lower NFT trading volume than Solana and Ethereum, Cardano is an up-and-coming NFT blockchain with huge potential.
Cardano is a third-generation, proof-of-stake blockchain. It is able to run smart contracts and dApps, and focuses on scalability and interoperability. Cardano utilises ADA, its native cryptocurrency, and has been following an extensive roadmap since its inception. Cardano has historically done things slowly with almost flawless execution. This has seen the network receive high praise and criticism simultaneously.
- Low fees and fast transactions: Much like Solana, Cardano benefits from low transaction fees and speedy transactions. The average cost of a transaction on Cardano is 0.1 ADA, making it an affordable option for NFT investors.
- No need for smart contracts: Cardano NFTs don’t require the use of a smart contract, removing the potential for errors. This also makes Cardano NFTs more secure and easier to deploy than other blockchains.
- Reliability: Since its inception, Cardano has never experienced any network outages. This makes it an incredibly reliable option for NFT developers and investors, especially compared to its rival Solana.
- Low trading volume: Cardano has a significantly lower NFT trading volume than a lot of its competitors. Despite some interest from influential figures like Snoop Dogg, there is an apparent ‘lack of interest’ in Cardano NFTs. This might dissuade new developers and investors from getting involved. This will, in turn, keep the volume low.
- Fewer notable projects: Despite having several projects with over 25 million ADA in total sales – SpaceBudz, Pavia and Clay Nation – there are very few standout names within the Cardano NFT space. Cardano is currently missing the notoriety of some of the many successful projects on the Ethereum blockchain.
- Continuing development: Cardano is still an ‘unfinished’ product. The network is still undergoing changes, which could negatively impact the production and sales of NFTs in the future.
Binance Smart Chain
Binance Smart Chain (BSC) is an Ethereum Virtual Machine (EVM) compatible blockchain. It runs alongside, but is entirely independent from, the Binance Chain. BSC has seen continued interest in its non-fungible tokens over recent months and years. It operates using the BEP-721 token standard, which means that Ethereum-based developers can create NFTs on Binance Smart Chain with few noticeable changes.
Binance Smart Chain launched in September 2020, a year and a half after the launch of Binance Chain. The original Binance Chain is structurally limited and doesn’t allow for the creation of smart contracts. BSC was created – instead of upgrading the original Binance Chain – to mimic the functionality of Ethereum and other smart contract platforms.
- EVM compatible: Binance Smart Chain is compatible with Ethereum Virtual Machine. Developers are therefore able to port their projects, tools and dApps from the Ethereum network to BSC. This makes the network interoperable, increasing the potential adoption of Binance Smart Chain NFTs.
- Low transaction fees: BSC utilises the proof-of-staked-authority (PoSA) consensus, which enables a short block time and low fees. As a result, the buying and selling of NFTs on Binance Smart Chain is incredibly affordable.
- Backing from Binance: Created by Binance, the world’s largest crypto exchange, BSC benefits from substantial financial backing, celebrity-endorsements and a significant marketing budget. This support could be beneficial and lead to increased adoption for Binance Smart Chain, and its NFTs, as a result.
- Low liquidity: Despite some growth in the past year, Binance Smart Chain still falls behind Solana and Ethereum in terms of trading volume. Similarly to Cardano, developers will be more inclined to create non-fungible tokens on the blockchains whose projects are already proving to be successful.
- Centralization: There are approximately 20 validators working on the BSC network. This makes it incredibly centralised compared to its competitors. Considering the importance placed upon decentralization, this is almost certainly enough to steer developers and potential investors away from the network.
Which NFT Blockchain is Best?
The NFT space is not limited to the four blockchains mentioned above. There are a number of other popular and well designed blockchains, perfectly suited to the creation and development of NFTs. Tezos, Avalanche and Flow are three lesser-known NFT blockchains, all of which have several key selling points that make them worthy of consideration.
Although it’s not possible to definitively say which NFT blockchain is best, there is a stand-out candidate. Solana has a better trading volume than its competitors and even occasionally surpasses that of Ethereum. It also offers faster and cheaper transactions and a number of excellent projects with proven track records.