Ethereum Vs. Bitcoin: What’s The Difference?
Bitcoin was introduced to the financial world as a digital currency that promised to revolutionize how money works. Its source code for peer-to-peer transactions is publicly available, and it is open-source software, which means that it can be modified or copied by anyone with computer skills. This decentralized system made Bitcoin economically desirable to a large group of people who were sick of the current systems of power holding people back and dictating their lives. The two major currencies that have made significant growth in recent years are Bitcoin and Ethereum. Ethereum has also played a decent role in the rise of the cryptocurrency market and globalization. Someone who use the immediate-connect knows the significant potential of investing in Bitcoin and Ethereum. Both these currencies gained mass appreciation from different people and investors worldwide. However, a few significant dissimilarities set these two apart besides they both work on blockchain currency systems. To make an educated decision while trading crypto, it is essential to understand these differences in the first place.
An Introduction to Bitcoin
Before starting, it should be noted that Bitcoin is the most popular and the first decentralized currency. It was invented back in 2009 by an unknown person named Satoshi Nakamoto, who disappeared shortly after creating Bitcoin. Since its development, Bitcoin has seen many debates over who can be called Satoshi Nakamoto. Many people think that it could be one of the early investors in Bitcoin or even a group of like-minded programmers out to change how money works. Some professionals even believe that Satoshi Nakamoto is a pseudonym for a company behind all this digital currency hype, just like we have seen with other technologies such as the Internet or smartphones. Despite all these assumptions about Bitcoin, it still managed to rank the top among all the cryptocurrencies in the market.
Defining Ethereum Currency System
It is a platform known for its two significant features, decentralized nature and running smart contracts. Smart contracts are applications that run as per the basis of their design to help in running interfaces with minimum risk of fraud and censorship. Furthermore, apps developed with ethereum blockchain function on its specific blockchain, which has global recognition for moving around assets or defining your ownership over a property. These facilities help initiate transactions on a safe and sound level without involving any middle man. The Ethereum market cap is slightly lower than that of Bitcoin’s, but it is still pretty solid compared to other currencies of the crypto network.
Some Major Differences between Bitcoin and Ethereum
The significant difference between the two currencies is how they were invented and what purpose they were created for. Some most common differences between Bitcoin and ethereum include:
- The first-ever cryptocurrency in the market was Bitcoin, which was developed to start a decentralized and peer-to-peer transaction system. However, Ethereum was developed with a broader purpose in mind, offering smart contracts that run without downtime, censorship, fraud or third-party interference.
- There are many differences over and above, including how both currencies are used, their blockchain and mining differences, and the different periods both have been available on the market.
- There is also a difference between the storing facilities of both these currencies. While Bitcoin allows you to store in various options like e-wallets, exchanges, and hardware downloading facility; ethereum comes with the only option to store in an online wallet offered by currency exchange.
- The ROI percentages of both these currencies are also different. While Bitcoin offers the highest returns among all currencies in the market, ethereum is still struggling in this regard compared with Bitcoin. But still, you can make actual earnings by trading in Ethereum.
- While Bitcoin is limited to being used as a currency, Ethereum is more like a technology that various big companies now use to develop programs for their use. Therefore, Ethereum is considered a more healthy and robust competitor in this regard.
Millions of people globally are already trading Bitcoin and other cryptocurrencies daily with different currencies. These include various fantastic performing currencies like Bitcoin, Ethereum, Litecoin, Monero etc. The blockchain and cryptocurrency market is set to set new standards for the future.