Ethereum vs Solana: LMAX Group selects SOL-based network to enter DeFi space

LMAX Group has become the first major institutional exchange joining the Pyth Network, a decentralized financial market data distribution network.

The move opens the DeFi doors to LMAX, a renowned operator of institutional execution venues for FX and cryptocurrency trading. The firm will directly publish its FX and cryptocurrency data to the network.

Built on the Solana blockchain, a challenger to Ethereum’s dominance in the DeFi space, Pyth connects high-fidelity market data from the world’s largest professional traders and exchanges to any smart contract, anywhere.

Integrating LMAX’s data is one more step for Pyth as it realizes its vision of distributing readily available, real-time, and verifiable data using high-performance blockchains.

Pyth network assimilates the prices and confidence intervals published by its data providers and attempts to use formal likelihood methods to produce a fair representative price that incorporates all the information it has received. The network can include historical quality, potential stake at risk, and other useful pieces of information.

This is one of the many reasons why Solana made sense as a home base for the Pyth network, the firm stated in its blog: “Solana is the only chain that allows for the compute bandwidth to apply heavy processing on the data to create much smarter outputs. Not only that, but it allows the network to be fast. Who says you cannot have better latency and more bandwidth.”

David Mercer, CEO of LMAX Group, commented: “We are hugely excited by DeFi and believe it can transform capital markets as we know them in the years ahead. Real-time, precise, reliable market data is the foundation of efficient asset pricing and valuation that ensures a robust and orderly marketplace. At LMAX Group we will always lead when the trajectory is clear, and it is entirely natural for us to be the first market data exchange contributor to Pyth. I’m positive others will follow in short order.”

“We believe the Pyth network built on the low latency Solana blockchain can revolutionise and democratise market data provision. This is a milestone for the industry as the DeFi ecosystem expands and we look forward to helping develop the network, which will be the primary market data oracle. We are pleased to announce that we are already streaming our leading, precise core FX and crypto data on the network”, Mr. Mercer added.

“Whilst others are still waking up to the fact that crypto-assets are here to stay, we are delighted to partner with visionaries who see a better capital markets ecosystem that operates 24×7 across all asset classes.”

Jump Trading is backing the Pyth Network, but no figures have been disclosed. “It’s immensely exciting news that LMAX Group has joined the Pyth network. The Group’s best-in-class FX and crypto market data will be an important contribution to Pyth and it is a huge step forward for the network. We look forward to welcoming other exchanges in other asset classes in the months ahead”, said Dave Olsen, President and Chief Investment Officer at Jump Trading Group.

The Solana token, SOL, has seen its price tumble nearly half in the mid-June crypto crash that is still ongoing. It is now trading at around $22, while its direct competitor, Ethereum’s ETH, has dropped by a third to just above $1,800.

Solana Labs has recently been boosted as Circle and Maps.ME announced a partnership to offer USDC on the Maps.ME integrated digital wallet. USDC is integrated into several chains and was integrated into Solana at the beginning of this year.

For Solana, this is likely to be a big win and a win that places it in direct competition with Ethereum which is likely to be the key aspect for the blockchain world in the coming years.

Solana Labs had raised $314 million from various investors recently to fund its global expansion and partnerships and it is tie-ups like these that are likely to boost its user base as it positions itself as a viable alternative to ethereum in the long run.

The crypto token sale was led by Andressen Horowitz and Polychain Capital along with Alameda Research and 1 kx among others. It is believed that this investment would be used to encourage other startups to build on the Solana blockchain and also to have a fund that will invest into companies that build within the ecosystem, the company said.

This well and truly begins the competition between Solana and Ethereum to become the blockchain of choice for developers to build on. Though Ethereum is very well developed over the last few years and most of the apps and DeFi startups are building on Ethereum, its high fees and network congestion have been pointed out by its critics recently as something that kills innovation .

Though the fees are expected to become lower when ETH 2.0 is fully launched and operational, it is understood that many developers and blockchain startups have already started looking at alternatives.