Ethereum and Solana — programmable money platforms

How are they different from Bitcoin?

Bitcoin = money. You can send it, receive it, hold it. That's it.

Ethereum/Solana = platforms that run smart contracts — programs that automatically execute transactions according to rules. DeFi (lending, LP, options) only works on smart contract platforms.

A smart contract example

The "Kamino" smart contract:

IF a user deposits $100 worth of SOL as collateral,
THEN allow them to borrow up to 50 USDC.

IF the user's SOL price drops below the threshold,
THEN automatically sell part of the SOL to cover the debt.

All of this happens without a bank, without any human involvement — the code executes automatically.

Bitcoin vs Ethereum vs Solana — a comparison

Aspect	Bitcoin	Ethereum	Solana
Launched	2009	2015	2020
Smart contracts?	Basic only	Full (Solidity)	Full (Rust)
Block time	10 min	12 sec	0.4 sec
TPS (transactions/sec)	7	30	3,000+
Fee	~$0.50–2	~$0.01–0.30	~$0.001–0.01
Energy	High (PoW)	Low (PoS)	Low (PoS)
Use case	Store of value	DeFi, NFTs, ICOs	DeFi, gaming

Our strategy uses two networks — Ethereum and Solana. Here's the key difference:

Ethereum — the king of DeFi networks

ETH

Advantages

The largest DeFi network — the highest TVL (Total Value Locked — total value locked in the protocol) of any blockchain
Reliability — running since 2015 without a network-level hack
Liquidity — deep capital in its pools
Smart contracts — written in the Solidity programming language

Drawbacks

Variable fees — during quiet periods, gas (the transaction fee) on mainnet (the main network) is only about $0.01–0.30, but it can jump many times over during network peaks; before a larger operation, it's worth checking etherscan.io/gastracker
Slower — 30 TPS isn't much
Complex — a steeper learning curve for users

In our strategy

Aave (lending) ETH
Uniswap V3/V4 (LP) ETH

Solana — fast and cheap

SOL

Advantages

Fast — 0.4s/block, 3,000+ TPS
Cheap — ~$0.001–0.01 per transaction
Growing ecosystem — Kamino, Orca, Meteora, Jupiter
Mobile-friendly — Phantom and Jupiter Mobile apps

Drawbacks

Newer — running since 2020 (Ethereum since 2015)
Network outages — has had historical outages (the last one in early 2024)
Centralization — fewer validators than Ethereum

In our strategy

Kamino (lending) SOL
Orca Whirlpool (LP) SOL
Meteora DLMM (LP, alternative) SOL
Jupiter (swap) SOL

Layer 2 — Ethereum's "flyover"

What is an L2?

After the 2024 "Dencun" upgrade, Ethereum mainnet fees are low during quiet periods (a few cents), but they move with network load and can jump many times over during peaks. Layer 2 networks smooth out that swing:

They batch thousands of transactions off-chain (outside the main network)
Bundle them into one large "rollup" (a summarized batch of transactions)
Periodically post the result to Ethereum mainnet (for security)
For the user: the fee stays small and stable (usually under $0.01) even when mainnet is congested

Main L2s

Network	Gas price	Used for
Arbitrum	<$0.01 (DeFi ~$0.01–0.05)	Aave, Uniswap V3
Optimism	<$0.01 (DeFi ~$0.01–0.05)	Aave, Uniswap V3
Base (Coinbase)	<$0.01	One of the largest L2s
zkSync	<$0.01	ZK-rollup

Our recommendation: use Arbitrum for the Ethereum strategy (one of the largest DeFi TVLs among L2s).

How to tell networks apart — and send with confidence

Every network has its own address format — and that works in your favor, because you can spot it at a glance:

Bitcoin:           bc1qxy2kgdygjrsqtzq2n0yrf2493p83kkfjhx0wlh
Solana:            7Xm2bNJk...K9pQ3Lq
Ethereum mainnet:  0x742d35Cc...a4f
Arbitrum:          0x742d35Cc...a4f (SAME format, BUT a different network!)

Three cases worth knowing — each with a simple fix:

BTC → SOL address (different formats) → check the start of the address: bc1... vs 7Xm... are obviously different
SOL → ETH address (different formats) → same idea — you won't confuse 7Xm... with 0x...
ETH (mainnet) → Arbitrum (same format, different network) → you pick the network in the sending form; read which one is selected before confirming

One habit covers all three: (1) the address format matches the network, (2) the correct network is selected in the sending form, (3) you send a small test amount ($5–10) the first time. Once this becomes automatic, you make transfers without a moment's hesitation.

Which network is right for you?

Scenario	Recommendation
Beginner	Solana — cheap, simple
Larger amounts (>$50k)	Ethereum — security, liquidity
Active trading	Solana — fast, cheap
Long-term hold	Bitcoin + either
LP fees	Solana (Orca) or Ethereum L2 (Uniswap)

Summary

Bitcoin = money. Ethereum/Solana = money + programmable rules
Solana SOL = fast and cheap (for beginners)
Ethereum ETH = security and liquidity (for larger amounts)
Layer 2 (Arbitrum) = Ethereum-level security at Solana-like prices
You can tell networks apart from the address format — a habit that takes minutes to build
Our strategy uses both platforms

Once you understand how these networks differ and how they work, you can judge any DeFi offer yourself — starting by asking which network it runs on, and what that means for cost and speed.

Quick check

How do Ethereum and Solana differ from Bitcoin?

Practice task

0 / 5

Compare Ethereum and Solana fees live

In the lesson you saw a table of fees. Now check them yourself in real time on both networks — it takes about 5 minutes, nothing to buy.

This is learning, not investing — use only small amounts you treat as tuition.

You just checked both networks' fees yourself in live block explorers — that's a skill most people never bother to pick up.

Bitcoin — digital gold Blockchains and networks