Bitcoin and Ethereum are two digital-assets with a never-ending tale. And while both are the most valuable cryptocurrencies as at month three of quarter three of 2020, subtle differences still persist.
Bitcoin leads in market capitation, being five times higher than the one of Ethereum. Coincidental similarities also prevail.
However, more critical distinctions require to be drawn for a stakeholder, and clarity shed regarding why one prefers any for the other. While Ethereum’s founder Vitalik Buterin is a familiar figure, Bitcoin’s Satoshi Nakamoto remains a pseudonym.
A point that always raises skepticism and room for conspiracy theories regarding why Nakamoto’s real identity remains unclear.
From a developer’s point of view, every blockchain has a unique purpose, and the same is explicitly applicable for Bitcoin and Ethereum.
Both BTC and ETH are digital assets, each running on its blockchain and in line with respective protocols. More so, Bitcoin is the first cryptocurrency, while Ethereum is the first Altcoin.
The inception of Ethereum within the crypto-verse sparkles a rally like no other. Currently, close to 5000 digital assets exist in line with the listing by Coingecko.com.
Comparing the Cryptocurrencies
Comparisons of cryptocurrencies are a great way to launch a discourse with a value proposition for each. It’s a relative debate, and significant consensus can be drawing from across the board.
No cryptocurrency is similar to any other. Those minute differences are existing cand reach contributes to the overall contrast. A case for a pair is quite simple to scheme through and capture deviations.
While some cryptocurrencies may almost perfectly match up similarities to a great extent, their developers would most certainly be different at many levels either by accident or coincidence.
Ethereum vs Bitcoin: The Basics
Ethereum came into existence on the 30th July 2015 with the acronym symbol ETH. Bitcoins had come earlier- 3rd January 2009 with the acronym BTC. Ethereum’s founder Vitalik Buterin’s faith that the Bitcoin blockchain required a scripting language, and finding no support launched the same with Ethereum.
Bitcoin has only one founder0 Satoshi Nakamoto, and Ethereum has an unusually long list, and Vitalik Buterin sits at its core.
At the elementary level, Bitcoin pursues the establishment of virtual currency that is decentralized – with no point of manipulation. Ethereum, on the other hand, pursues the formation of a platform for launching decentralized applications, and the most prominent is smart contracts.
Smallest unit of Bitcoin is a Satoshi, which is one Bitcoin split up to a million times.
On the other end, the Ethereum blockchain is powered by Ether as the rewards for miners. 1 Ether can be split into 1 Billion units, each known as Gwei. Further, when 1 Gwei is split into a billion units, you get 1 Wei.
By being decentralized, both BTC and ETH have no authorized issuer in a central bank’s capacity.
Blockchains are merely public ledgers and are accessible to any users who access the internet. BTC and ETH both work on distributed ledgers’ principles, operating with cryptography facilitating data encryption on both.
Main Differences Between Bitcoin vs Ethereum
The difference between Bitcoin and Ethereum stems from the original purpose of each respective blockchain. Aside from being digital assets, BTC vs ETH differs in several arrays ranging from user needs to protocols behind each.
Ethereum blockchain is unique – an open-source platform for creating decentralized applications. Bitcoins blockchain protocol allows a maximum mining capability of 21 Million Bitcoins. Virtually, Ethereum, as a software platform, has infinite capabilities with the vastness of the applicable cases.
Technically, Ether platform algorithms run on Ethash, Bitcoin algorithms run on SHA-256.
Ether transactions contain bits of executable codes, while those of Bitcoin only include notes. Ether transactions close within seconds while those of BTC takes minutes.
Both BTC and ETH are accessible on their respective blockchains with no party with individual control at any point (without majority consensus).
Smart contracting enables codes to control agreements based on underlying conditions- away from human interference. Bitcoin has no smart contracts; it’s an online medium of exchange.
On the other end, Ethereum’s primary purpose is a platform where coders can make agreements filed on the blockchain. Therefore, smart contracting is the main distinguishing factor between it and the one of Bitcoin.
Ethereum vs Bitcoin: The Conclusions
Is Ethereum better than Bitcoin?
Bitcoin will facilitate you to pay for goods and services. Ethereum will enable you to develop smart contracts.
In terms of capitation, BTC is far better than ETH. From a neutral perspective, BTC and ETH are the most valuable digital assets concerning popularity and price. It depends whether you are an investor, trader or consumer.
Which has Better Technology between Bitcoin vs Ethereum?
Both BTC vs ETH has the best technologies for each. Each technology aligns with the primary purpose right from inception. Since bitcoin did not allow smart contracting- none of them is superior to the other.
Bitcoin has scalability problems – with transactions taking long to clear. Ether transactions clear very fast. Along time, other blockchains with scalability solutions like lightning network and sidechains have arisen so strongly to close the gap.
Final Conclusion – The Difference Between Bitcoin and Ethereum
There are many notorious differences between Bitcoin and Ethereum. Right from the core purpose of blockchain applicability to its use cases. Under the technical details underlying each, they use distinct hashing algorithms to deploy its encryption mechanisms.
More fundamentally, Bitcoin is more aligned to unbanking societies – creating a medium of exchange that’s publicly accessible to anyone globally as long as people have internet access. Ethereum, on the other hand, is a business driver software – facilitating agreements in the form of smart contracting – with a vast landscape of usable and applicable cases with global appeal.
At some point, there are relative notions from a holistic point of view between BTC and ETH. While Bitcoin sorts trust issues with monetary transactions, Ethereum comes in to seal the loops with trust in contracting. Therefore, both seem to create a blend to form a sense of trust never experienced within business circles.
Lastly, every digital asset has a unique value offering that is required by subscribers. That’s what makes the entire chain command stakeholder interests in ways that are beneficial to them. To know more about cryptocurrencies, download the Tezro app and experience different assets that these currencies can bring you.