Bitcoin or Ethereum?
Bitcoin, being the first peer to peer crypto currency, was created 7 years ago by the mysterious Satoshi Nakamoto. Bitcoin is operated by a decentralized authority unlike government Fiat currencies and promise a lower transaction fees than conventional online payment system. Bitcoins are not physical, they are stored into wallets associated with public and private keys.
In early 2014, Ethereum was announce by Vitalik Buterin at North American Bitcoin Conference, and has since then received a lot of attention. Ethereum gained its popularity naturally because of its constant comparison to Bitcoin, the first peer to peer crypto currency. However, as an investor, very important you understand the differences and connections between Ethereum and Bitcoin.
Bitcoin Vs Ethereum, the difference
Although Ethereum and Bitcoin are both power-driven by the theory of cryptography and distributed ledgers, the two coins are different in several practical ways. Let’s examine the programming language used for the two coins as an example Ethereum makes use of Turning complete while Bitcoin is based on a stack based language.
Block time is another major difference between the two coins, while Ethereum transactions are confirmed within seconds, reverse is the case for Bitcoin, it takes minutes for Bitcoin transactions to be confirmed.
- Ethereum: make use of ethash
- Bitcoin: Uses secure hash algorithm, SHA-256).
In terms of purpose, Bitcoin and Ethereum also differs.
- Bitcoin: Bitcoin serves as a medium of payment transaction and store of value and it is created as an alternative to regular money
- Ethereum: Ethereum platform is designed to aid peer-to-peer contracts and applications via its own currency.
Although both Bitcoin and Ether are crypto currencies, but Ether is not developed to establish itself as a payment method or alternative like Bitcoin
Ether is developed to facilitate and monetize the working of Ethereum. This will enable developers to build and run distributed applications (ĐApps).
Conclusion/ final thought
Based on the principle of blockchain, Ethereum is a development that supports bitcoin but doesn’t compete with Bitcoin in any way.
With that being said, from the trading perspective and due to the rising market capitalization and popularity Ether, the currency is able to compete with all other cryptocurrencies. At this present moment, Ether (ETH) has the highest market cap when compared with Litecoin and Ripple. However, it’s very far from reaching Bitcoins market position.