Let’s admit that cryptocurrencies are all the rage these days. The internet and mass media are overwhelmed with the latest buzz related to cryptos. Above all, everyone seems to be discussing cryptocurrencies nowadays. Investors of all types, beginners, and professionals, have a keen interest in crypto transactions. Consequently, digital investments are at an all-time high.
Despite being so popular, cryptocurrencies sound confusing and even intimidating to many people. They consider the domain to be too complicated to understand due to different concepts and terminologies. Besides, they often fall into a dilemma of where to invest, ethereum or bitcoin? Furthermore, they risk making the wrong choice due to a lack of knowledge regarding bitcoin and ethereum.
The most prominent terminologies in the crypto world, ethereum, and bitcoin, are premium investment options, provided you have knee-deep knowledge about them. Although they are trending in the crypto market, ethereum and bitcoin have several differences that you must know. So, without delaying further, let’s dive into understanding the critical distinction between ethereum vs. bitcoin!
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What Do You Mean By Bitcoin?
Let’s begin our discussion by understanding each player individually. So, here is all about Bitcoin. Keep reading!
So, what do you mean by Bitcoin? Essentially, it is a decentralized digital currency that allows transactions without the presence of a bank-like intermediate. Bitcoins work on a digital ledger system that records all transactions made to date.
Surprisingly, the records remain open to everyone and are tamper-proof. So, faking a Bitcoin transaction and making fraudulent exchanges are next to impossible when dealing with such transparent digital currencies. All these reasons make Bitcoins popular and a worth-considering alternative among investors.
Bitcoin – The Key Features
Created by Satoshi Nakamoto, Bitcoin oozes numerous features that add to its massive popularity worldwide. To get a better picture of the difference between Bitcoin and Ethereum, you should know the features of the former. So, here are all the characteristics of Bitcoin listed below.
- Bitcoins remain out of reach of governing bodies like banks. So, they cannot lock or control Bitcoin accounts.
- Bitcoin offers more freedom to the users as they are under minor limitations.
- Printing more money cannot lead to more inflation when dealing with Bitcoins.
- Another fascinating Bitcoin feature is that the transactions remain free from tax and other charges.
- One can witness higher transaction speed when exchanging Bitcoins than conventional currencies.
- Mainly, Bitcoin transactions encompass no processing charges.
Ethereum – What is It?
Now that you know about Bitcoin, it’s time to get well-acquainted with the next competitor, Ethereum. So, here are some exciting things about Ethereum. Take a look!
Ethereum is a Blockchain-driven decentralized computing network. It extends much beyond usual crypto transactions, unlike other digital currencies. It provides a copy of the centralized digital ledger to all investors to track all Ethereum transactions made to date. Ethereum lets users create Blockchain-based apps and exchange Ether to buy and sell goods or various services.
Ethereum encompasses a host of features, making it the second most popular crypto after Bitcoin. Here are all the characteristics of Ethereum that you should know. Follow along with the article below!
Key Features of Ethereum
Ethereum is slightly different from other cryptocurrencies. Here are all its features at a glance.
- Ethereum is a decentralized computing network.
- Ether is the currency used in the Ethereum network.
- Ethereum lets you develop and implement smart contracts.
- Interaction with smart contracts has become simple with Ethereum. It provides the foundational architecture and underlying software to host and manipulate Smart Contracts.
- Abbreviated as DAPP, Ethereum allows you to develop comprehensive decentralized applications.
Ethereum Vs. Bitcoin – The Battle Begins!
By now, you must have substantial knowledge of Ethereum and Bitcoin. However, the differences between the two popular terms remain unclear. Don’t worry anymore! Below are a few of the most significant differences between Ethereum and Bitcoin. Let’s get started!
As already discussed, Bitcoin is a decentralized cryptocurrency. In contrast, Ethereum is a decentralized computing network with Ether as the native currency. So, Ethereum is a broader umbrella that holds numerous features, unlike Bitcoin.
Talking about popularity, Bitcoin and Ethereum are the talks of the crypto world. According to statistics, Bitcoin is more prominent than Ethereum and highly discussed in the digital currency domain.
Besides, Ethereum is a broader concept and has more features than Bitcoin. So, it leads to other terminologies and transaction modes by staying as the second most popular term in digital transactions.
Founded by Satoshi Nakamoto, Bitcoin came into existence in January 2009. In contrast, Vitalik Buterin and Gavin Wood laid the foundation of Ethereum in July 2015. Despite being a late-comer, Ether has grown rapidly and now stands along with the most popular cryptocurrency, Bitcoin.
4. Block Time
Based on the block time, you can differentiate between Bitcoin and Ethereum. The average block time of Ethereum is around 15 seconds, and in contrast, Bitcoin has an average block time of nearly 10 minutes.
5. Transaction Throughput
Ethereum seems to defeat Bitcoin in terms of transaction throughput, and it allows as high as 30 transactions in a second. However, things change when considering Bitcoin, and it will enable only seven transactions per second, making it slower than Ether’s more advanced Ethereum native currency.
Ethereum has no restrictions on supply and has an infinite supply cap. In comparison, Bitcoin has a finite supply-cap with 21 million BTC. So, Ethereum leads Bitcoin when considering its supply-caps.
As time passed, revolutions swept the cryptocurrency domain. Consequently, more advanced innovations like Ethereum have shown up. Despite being one of the primordial cryptos globally, Bitcoin retains its prominent place and remains the most widely used mode of digital transactions across the globe.
Phew! That was a roller-coaster ride. Ethereum and Bitcoin are easy-to-understand, provided you know the underlying concepts and mutual differences. Now that you know the difference between Bitcoin and Ethereum, you are all set to make the wisest decision and soar high in the cryptocurrency industry.