Ethereum, created in 2015 by Vitalik Buterin, first introduced the idea of using blockchains for Turing complete smart contracts, allowing developers to build permissionless apps. However, Ethereum suffered from scalability issues during its hypergrowth period, which allowed competitors to pitch "faster, cheaper, more scalable" blockchains. Ethereum's scaling solution, to increase throughput not at the base layer but via layer-2s, fragmented liquidity and created considerable hurdles to user experience and user acquisition. Each layer-2 felt like a siloed ecosystem rather than an integrated whole.
Solana, one of the projects that emerged in 2020 to take on this challenge, has seen a thriving ecosystem of apps and developers. It's vision is to scale the chain horizontally by increasing its throughput. While seemingly more centralized than Ethereum, Solana has been able to attract developers and build many successful protocols like pump.fun for memecoin launches. It has emerged as a strong competitor to Ethereum as the go-to smart contract platform.
Cite This Comparison
"Ethereum vs Solana (ETH vs SOL): Returns, Risk & Volatility (2026)." Gale Finance, January 10, 2026. https://www.gale.finance/compare/eth-vs-sol Free to use with attribution. Please link back to this page or gale.finance.
Analysis period: 2025-01-11 to 2026-01-10
Relative Performance of ETH vs SOL (Normalized to 100)
Normalized to 100 at start date for comparison
Key Takeaways
- Total Return: ETH delivered a -5.7% total return, while SOL returned -27.7% over the same period. ETH outperformed on total returns.
- Risk-Adjusted Return (Sharpe Ratio): SOL had a negative Sharpe (-0.01) while ETH was positive (0.23), indicating ETH had meaningfully better risk-adjusted performance in this period.
- Volatility (Annualized): SOL was more volatile, with 85.3% annualized volatility, versus 74.9% for ETH.
- Maximum Drawdown: ETH's maximum drawdown was -57.7%, while SOL experienced a deeper drawdown of -59.8%.
- Tail Risk (VaR & Expected Shortfall): At the 5% level (daily log returns), ETH's VaR was -5.85% and its Expected Shortfall (CVaR) was -8.76%; SOL's were -6.40% and -9.74%. VaR is the cutoff; Expected Shortfall is the average move on the worst days.
- Skew & Kurtosis: Skew: ETH 0.22 vs SOL 0.00. Excess kurtosis: ETH 3.37 vs SOL 3.99. Negative skew leans downside; higher excess kurtosis means fatter tails.
- Tail Days & Extremes: 2σ tail days (down/up): ETH 10/9, SOL 7/10. Worst day: ETH -15.86% (2025-03-04) vs SOL -22.33% (2025-03-04). Best day: ETH +19.38% (2025-05-09) vs SOL +21.71% (2025-03-03).
Ethereum vs Solana Correlation
Ethereum and Solana are strongly correlated over the past year. With a correlation of 0.83, these assets tend to move together, limiting diversification benefits.
For portfolio construction, this strong correlation means holding both ETH and SOL provides limited risk reduction — they're likely to decline together in downturns.
| Metric | Metric | Value |
|---|---|---|
| Current (30-day) | 0.87 | |
| Average (full period) | 0.83 | |
| Minimum | 0.16 | |
| Maximum | 0.97 |
Correlation measures how closely two assets move together. Values near +1 indicate strong co-movement, near 0 indicates independence, and negative values indicate inverse movement.
Investment Comparison
If you invested $10,000 in each asset on January 11, 2025:
Difference: $2,198.83 (ETH ahead)
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Ethereum and Solana: Risk Analysis
Ethereum experienced its maximum drawdown of -57.7% from 2025-01-18 to 2025-04-09. It took 100 days to recover.
Solana experienced its maximum drawdown of -59.8% from 2025-01-19 to 2025-04-09. It has not yet recovered to its previous peak.
Smaller drawdowns and faster recoveries indicate lower downside risk and greater resilience during market stress.
Sharpe Ratio of ETH and SOL
Sharpe ratio measures return per unit of risk (volatility). A higher Sharpe indicates better risk-adjusted performance. SOL had a negative Sharpe (-0.01) while ETH was positive (0.23), indicating ETH had meaningfully better risk-adjusted performance in this period.
A Sharpe above 1.0 is generally considered good, above 2.0 is excellent. Negative Sharpe means the asset underperformed the risk-free rate. Calculated on each asset's full 365-day lookback of available prices and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).
Sortino Ratio of ETH and SOL
Sortino ratio measures return per unit of downside risk. Unlike Sharpe, it only penalizes negative volatility. ETH had better downside-adjusted returns.
A higher Sortino is better. It's particularly useful for assets with asymmetric volatility (big gains, smaller losses). Downside volatility: ETH 48.7% vs SOL 54.0%. Calculated on each asset's full 365-day lookback of available prices and annualized using the asset calendar (365 for crypto, 252 trading days for equities/ETFs/metals).
Tail Risk & Distribution Shape: Ethereum vs. Solana
This section looks at the shape of daily returns, not just the average. We use daily log returns so multi-day moves add cleanly.
| Metric (1y) | ETH | SOL |
|---|---|---|
| 5% VaR (daily log return) | -5.85% | -6.40% |
| 5% Expected Shortfall (CVaR) | -8.76% (worst 19 days) | -9.74% (worst 19 days) |
| Skew | 0.22 | 0.00 |
| Excess kurtosis | 3.37 | 3.99 |
| 2σ tail days (down / up) | 10 / 9 | 7 / 10 |
| Worst day | -15.86% (2025-03-04) | -22.33% (2025-03-04) |
| Best day | +19.38% (2025-05-09) | +21.71% (2025-03-03) |
Downside co-moves (2σ)
Computed on shared dates only (n=364). A “2σ downside move” means a shared-close log return more than 2 standard deviations below that asset’s own mean on this shared-date series. Dates below show simple returns (%) for readability.
Show downside tail dates
Dates below are shared-date observations. The “Date” is the period end (close). Tail thresholds are computed on log returns, but the table shows simple returns (%) for readability. Returns are computed from the previous shared close to this one (for example, Friday → Monday includes weekend moves).
Days when both ETH and SOL had a big down day (2σ)
| Date (interval) | ETH | SOL |
|---|---|---|
| 2025-02-25 | -11.46% | -16.02% |
| 2025-03-04 | -14.66% | -20.01% |
| 2025-04-07 | -13.00% | -11.99% |
| 2025-08-26 | -8.30% | -9.08% |
| 2025-10-11 | -12.20% | -14.00% |
| 2025-11-04 | -7.91% | -11.36% |
Days when ETH had a big down day
| Date (interval) | ETH | SOL |
|---|---|---|
| 2025-02-03 | -8.39% | -5.66% |
| 2025-02-25 | -11.46% | -16.02% |
| 2025-03-04 | -14.66% | -20.01% |
| 2025-03-10 | -8.31% | -7.49% |
| 2025-04-07 | -13.00% | -11.99% |
| 2025-04-11 | -8.34% | -5.11% |
| 2025-08-26 | -8.30% | -9.08% |
| 2025-10-11 | -12.20% | -14.00% |
| 2025-11-04 | -7.91% | -11.36% |
| 2025-11-05 | -8.44% | -6.28% |
Days when SOL had a big down day
| Date (interval) | ETH | SOL |
|---|---|---|
| 2025-02-25 | -11.46% | -16.02% |
| 2025-03-04 | -14.66% | -20.01% |
| 2025-04-07 | -13.00% | -11.99% |
| 2025-08-26 | -8.30% | -9.08% |
| 2025-09-26 | -6.88% | -9.18% |
| 2025-10-11 | -12.20% | -14.00% |
| 2025-11-04 | -7.91% | -11.36% |
Read this as “how ugly the ugly days get”, not as a precise forecast. One-year samples are small, so tail estimates are inherently noisy.
Ethereum vs Solana Volatility (ETH vs SOL)
Ethereum's annualized volatility of 74.9% means it typically moves ±3.92% on any given day.
Solana's annualized volatility of 85.3% means it typically moves ±4.47% on any given day.
SOL's higher volatility means a wider path to returns — this can be attractive for tactical, shorter-term exposure, while ETH's smoother profile may better suit long-term allocators seeking steadier growth.
For comparison, the S&P 500 typically has 15-18% annualized volatility, translating to roughly ±1% daily moves. Higher volatility means larger potential gains but also larger potential losses.
Ethereum vs Solana Performance Over Time
| Metric | ETH | SOL |
|---|---|---|
| 30 Days | -7.4% | -0.6% |
| 90 Days | -17.8% | -23.9% |
| 180 Days | 3.6% | -15.8% |
| 1 Year | -5.7% | -27.7% |
Shorter time frames can show different leaders as market conditions change. Consider your investment horizon when comparing performance.
Full Comparison of Ethereum vs. Solana (1-Year)
| Metric | ETH | SOL |
|---|---|---|
| Total Return | -5.7% | -27.7% |
| Annualized Volatility | 74.9% | 85.3% |
| Sharpe Ratio | 0.23 | -0.01 |
| Sortino Ratio | 0.36 | -0.01 |
| Max Drawdown | -57.7% | -59.8% |
| Avg Correlation to S&P 500 | 0.51 | 0.43 |
| 5% VaR (daily log return) | -5.85% | -6.40% |
| 5% Expected Shortfall (CVaR) | -8.76% | -9.74% |
| Skew | 0.22 | 0.00 |
| Excess kurtosis | 3.37 | 3.99 |
| 2σ tail days (down / up) | 10 / 9 | 7 / 10 |
Ethereum vs Solana: Frequently Asked Questions
Which has higher volatility: ETH or SOL?
SOL showed higher volatility at 85.3% annualized, compared to 74.9% for ETH Over the past year. Higher volatility means larger price swings in both directions.
Does ETH provide diversification when held with SOL?
ETH and SOL are strongly correlated over the past year, with an average correlation of 0.83. This strong correlation limits diversification benefits.
How bad are the worst 5% days for ETH vs SOL?
Over the past year, ETH's 5% VaR was -5.85% and its 5% Expected Shortfall was -8.76% (worst 19 days). SOL's were -6.40% and -9.74% (worst 19 days).
Do ETH and SOL crash together on bad days?
On shared dates (n=364), when SOL has a 2σ down day, ETH also does 85.7% (6/7 days). In the other direction, when ETH has one, SOL also does 60.0% (6/10 days).
Which has better risk-adjusted returns: ETH or SOL?
SOL had a negative Sharpe (-0.01) while ETH was positive (0.23) Over the past year, indicating ETH had meaningfully better risk-adjusted performance.
Can ETH and SOL be combined in a portfolio?
Yes, though allocation sizing matters. Their strong correlation provides limited risk reduction since they tend to move together. SOL's higher volatility (85.3%) means even small allocations can materially impact overall portfolio risk.