Ethereum Alternatives: The Best Alt EVM Chains
As an investor looking to maximize gains in the cryptocurrency market, you may be considering altcoins that aim to improve upon Ethereum. Ethereum pioneered smart contract functionality, but high gas fees and network congestion on Ethereum have opened the door for so-called “Ethereum Virtual Machine” (EVM) compatible chains to gain traction.
Originally called Binance Smart Chain, BNB Chain was launched by the popular cryptocurrency exchange Binance. BNB Chain is EVM-compatible, meaning it can support the same smart contracts and protocols as Ethereum. However, it was built using a consensus model called Proof-of-Staked Authority that greatly improves transaction speeds and reduces gas fees. You can think of BNB Chain as sort of a “sister chain” to Ethereum in that it supports all the same functionality, but with some technical modifications that allow it to outperform Ethereum by certain metrics. BNB Chain has seen massive adoption and is currently the second largest DeFi ecosystem behind only Ethereum itself.
When considering investments in the altcoin market, you’d be remiss to not give BNB Chain a close look. Many experts are predicting continued growth in usage and developers migrating their Ethereum-based apps over to take advantage of the speed and low cost BNB Chain provides.
Another rising star in the realm of EVM-compatible chains is Avalanche. Launched in 2020, Avalanche utilizes an innovative consensus mechanism called Snow Protocol that greatly increases transaction processing capability. Like BNB Smart Chain, it is fully EVM-compatible but built using a more efficient consensus model that allows it to match or even exceed the transaction volume of massive payment processors like VISA with very low fees.
Early data shows that deploying smart contracts on Avalanche can cost 95-99% less than on Ethereum, while finalizing transactions in under 2 seconds. These technical advantages have not gone unnoticed in the marketplace. Avalanche has quickly grown its DeFi and NFT ecosystem as developers have flocked to the network. As you survey the altcoin landscape looking for promising investment opportunities, Avalanche stands out for its innovative tech that solves major pain points holding Ethereum back. It already supports many of the top DeFi and crypto applications while leaving ample room to grow as its network effects take hold.
Last but certainly not least of the major EVM-compatible chains making waves is Fantom. Like Avalanche and BNB Smart Chain, Fantom is fully EVM-compatible but utilizes a proprietary consensus protocol called Lachesis that provides lightning fast transaction finality in only 1 to 2 seconds while maintaining robust decentralization and security. Fantom is specifically targeting DeFi applications and providing developers all the tools and infrastructure they need to deploy Solidity smart contracts quickly and easily. And users have taken notice. Fantom has rapidly grown to become one of the largest DeFi platforms and shows no signs of slowing down.
As DeFi continues growing in usage and importance, EVM-compatible chains like Fantom that focus specifically on decentralized finance could end up being big winners. Fantom certainly warrants some allocation in a diversified crypto investment portfolio based on its current traction and growth outlook.
When venturing outside of Ethereum to research and invest in promising altcoins, EVM-compatible chains represent some of the most viable contenders to gain meaningful market share. Chains like BNB Smart Chain, Avalanche, and Fantom directly address major shortcomings in the Ethereum network while maintaining compatibility with Solidity and Ethereum’s rich application ecosystem. All three warrant serious consideration for any crypto investor. The technical advantages translate to real world use as evidenced by the surging adoption of DeFi, NFTs, and web3 applications on these chains. As you assemble your portfolio, be sure to research these top EVM contenders. Their ability to improve upon Ethereum while leveraging network effects could make them sound long-term investments.