Bitcoin and Ethereum are two popular cryptocurrencies that have gathered a huge amount of attention and interest, which has led to substantial growth in their prices. However, most still ponder whether they should invest in Ethereum cryptocurrency or Bitcoin cryptocurrency.
What are the differences between Ethereum and Bitcoin?
The main difference between Ethereum and Bitcoin is that Bitcoin is a simple currency, whereas Ethereum is a decentralized ledger technology that many companies and businesses use for building programs. Bitcoin and Ethereum are based on blockchain technologies; however, Ethereum is based on strong blockchain technology, unlike Bitcoin.
The oldest and biggest coin, known as Bitcoin, has been in the crypto market for a long time. It has been leading in the crypto market for the last few years. The price of Bitcoin in 2017 skyrocketed, enabling this cryptocurrency to develop its own identity in the crypto industry. The value of Ethereum has not skyrocketed like Bitcoin, and it is yet to hit a milestone like Bitcoin. Institutional investors are purchasing Bitcoin these days, increasing its price and scarcity in the market. On the other hand, the Ethereum platform is also witnessing improvement in its speed, security, and efficiency; therefore, it has the potential to grow and expand further
- Network Transactions
The main similarity between Ethereum and Bitcoin networks is that both are powered by cryptography and distributed ledgers; however, they differ in network transactions. Ethereum network transactions work on executable code, but transactions on the Bitcoin network are used for storing nodes. There is a difference between using algorithms in both cryptocurrencies. Bitcoin uses the SHA-256 algorithm; however, Ethereum uses hash.
Ethereum is much faster than Bitcoin regarding block time. A transaction takes only a few seconds, whereas Bitcoin takes several minutes to complete one transaction. Ethereum networks and Bitcoin differ regarding their goals and objectives. Bitcoin was mainly designed to be a substitute for a national currency; therefore, it is used as a medium of exchange and contains a store of value. However, Ethereum was mainly designed to develop a blockchain platform with programmable and irreversible contracts and facilitate applications through its currency
- Total supply and mining rewards
There are distinct mining rewards paid to network nodes on every cryptocurrency network. While Bitcoin miners get a reward of 6.5 BTC for completing the SHA-256 equation, Ethereum minors get a reward of two ETH for their participation in validating the blocks of network transactions. Bitcoin caps a total supply of around 21,000,000 coins and works on the strategy to preserve scarcity in the crypto market. Unlike Bitcoin, there isn’t any cap in Ether amount. Ethereum network continues to make new ether to cover the gas fees that developers produce, so presently, there are around 114,467,625.91 ETH in circulation.
If you are wondering whether you should invest in Ethereum or Bitcoin in the upcoming days, then you have to gain an in-depth understanding of both coins to make an informed decision. Both have their potential, use cases, and a wide room to grow further. Both have different purposes and goals; therefore, you need to consider your project to decide whether you should choose Bitcoin currency or an Ethereum decentralized platform.