Ethereum remains one of the best crypto investments of all time. If you had invested in Ethereum in 2015, you would have made a profit of 63,500 percent today. So it’s important that some call a coin the “next Ethereum”. We’ve already seen this with cryptocurrencies like Solana and Avalanche. Both were tagged as potential Ethereum killers as soon as they hit the market. We are starting to see the same phenomenon with the layer-1 Blockchain Sui Coin, which entered the market in May. So, is there a possibility of a big jump for SUI as well? Here is the answer of Dominic Basulto, one of the analysts of the US-based consulting giant The Motley Fool…
What is Sui Coin?
Sui is a super-fast, super-scalable proof-of-stake Layer-1 Blockchain with a near-perfect pedigree. Most of the developers at Sui have worked on Meta Platforms’ major Blockchain project Diem. Sui’s founders have raised more than $330 million in venture capital from some high-profile names, including Coinbase Ventures. Right now the biggest attraction seems to be Sui’s transaction processing speed. The network claims to be able to process up to 300,000 transactions per second (TPS). This is far beyond what even Solana (65,000 TPS) can deliver. Moreover, the developer team behind Sui stands out largely with the programming language they use. It claims that because of this language, Blockchain is optimized for cryptoassets and the brave new world of Web3.
How high can Sui go?
A little market cap comparison will give you a good idea of how high Sui can go. It currently has a market cap of just over $500 million. If it achieves a 10x return on investment, that gives Sui a market capitalization of approximately $5 billion. This is the region of Solana and Avalanche. Currently, Solana’s market capitalization is $7.7 billion, while Avalanche’s is $4.7 billion.
But let’s say Sui eventually replaced Ethereum based on its superior performance characteristics. That’s when things get really interesting. Ethereum currently has a market cap of more than $200 billion. So if Sui catches Ethereum, that would be a 400x ROI. “You can start to understand why investors love the next Ethereum concept. The numbers are growing very quickly,” he says.
In many ways, the same logic applies to Aptos (APT), which was introduced in October 2022. Aptos was the other major Blockchain project to come out of Diem. Like Sui, he came with an impeccable pedigree, top developer talent, and high-profile venture capital backing. Despite hitting the market at the height of a practically hurricane (the FTX debacle in November 2022), Aptos is now up a staggering 125 percent to date. It has become one of the top 40 cryptocurrencies in the world by market cap.
So do we really need another Ethereum?
The real question, of course, is whether the blockchain world needs another Ethereum. It once existed because Ethereum was still a slow, old-fashioned PoW Blockchain. But last year, The Merge came out. “As a result, I am not convinced that we really need another Ethereum. Many speed and performance issues are now fixed. Ethereum ran The Merge without a hitch,” he said. He also used the following expressions:
So many things need to go right for Sui to achieve its grandiose growth targets. First, developers need to perceive a real need to abandon Ethereum and move to another blockchain for all future development projects. I don’t think this will happen. Moreover, Sui will need to defeat not only Ethereum but a long list of previous Ethereum killers including Solana, Avalanche and now Aptos. This is a big request.
“For now, I cannot recommend Sui as a long-term investment,” the analyst adds. It’s certainly interesting because of its price (still trading around $1) and history. But the analyst doesn’t think the higher speeds are enough to win over developers, users and investors. At the end of the day, people want to see what the platform is built on. “At the moment, you cannot beat Ethereum, which is dominant in many key areas of the blockchain world. Ethereum is still the world’s leading Layer-1 Blockchain. As a result, I remain bullish on Ethereum both in the short and long term,” he concludes.
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