Ethereum vs Bitcoin: Which One is Better For Beginners?
With thousands of cryptocurrencies currently available, Bitcoin and Ethereum still remain two of the most popular cryptos. Both cryptocurrencies are available for purchase in several crypto markets.
As the top cryptocurrencies, Bitcoin and Ethereum are usually pitted against each other. Is this comparison valid though?
For new crypto investors, deciding which of the two you should pour your money on can be a bit tricky. To simplify things, we will take an in-depth look into both cryptocurrencies to see which coin is better for you.
Ethereum has been around since 2015, though its white paper was first published in 2013. It was founded by Vitalik Buterin, Charles Hoskinson, Mihai Alisie, Jeffrey Wilcke, Anthony Di Iorio, Gavin Wood, and Amir Chetrit.
Though many are familiar with Ethereum, its cryptocurrency is actually called Ether, and the two should not be confused. Ether or ETH is used to buy goods and services and pay Ethereum fees.
Since its launch, Ethereum has become one of the most decentralized blockchain platforms, operating as a peer-to-peer network that offers financial services and aims at establishing decentralized apps and creating smart contracts.
Clearly, Ethereum has more to offer than just a cryptocurrency, and you can check out the latest Ethereum casinos to see the wide adoption of Ethereum blockchain technology in casino games. Unlike traditional casinos, Ethereum ones allow ETH as an alternative to fiat currency. They also include better and larger bonuses for those gambling with cryptocurrency.
It uses proof of stake, which is faster and cheaper.
It has a large developer community.
It has several applications.
It can be scaled up easily.
It is more environmentally friendly.
It has an unlimited supply, which can affect its market cap.
It is not as popular as Bitcoin.
Even though Bitcoin is seen as the first cryptocurrency, there were previous digital currencies before 2009, when Bitcoin was launched. Bitcoin was just the first successful one.
Founded by Satoshi Nakamoto, Bitcoin managed to prove that blockchain technology was possible and that digital currencies with no central regulation were possible.
Over the years, the cryptocurrency has become widely accepted, and different financial and governments have begun accepting it as a viable currency.
It is capped at 21 million tokens.
Bitcoin has been around for a while and has acquired some stability.
It currently has the highest market cap.
It is widely accepted by many governments and financial institutions.
It is secure, protecting its users from fraud. Any form of tampering is exposed using hashes, which must be identical in every node on the blockchain.
It has limited applications.
It can be extremely volatile, especially in recent years.
It is not environmentally friendly as it uses a lot of energy.
Ethereum vs Bitcoin Differences
Both Ethereum and Bitcoin are powered by the same technology, but they couldn't be any more different. Let us look at some of the ways these cryptocurrencies differ.
Bitcoin and Ethereum are both known as digital currencies but there is more to Ethereum. Ethereum was designed for more than just a payment system. As already mentioned, Ethereum aims at promoting the facilitation of smart contracts and dApps.
Bitcoin, on the other hand, was made for decentralized payments. It is purely used as a digital currency or rather, as an alternative to fiat money.
Total amount of tokens
Bitcoin has a limited supply of tokens that will ever be mined. There will only ever be 21 million Bitcoin. This will create scarcity, especially since there are already over 19 million Bitcoins mined. The scarcity of Bitcoin is one of the reasons why it is a favorite of many investors.
Conversely, Ethereum has an unlimited supply of tokens to be mined, and there are currently over 122 million mined Ether. Nonetheless, Ethereum announced in 2022 there are plans to reduce the mining of new tokens and burn circulating ones.
Proof of work
In blockchain technology, proof of work refers to the mechanism through which new transactions added to the block are verified for accuracy. Though POW protects the network, it is a highly computational process done by miners and rewarded in crypto.
Ethereum recently moved to proof of stake, which requires less computational power and is validated by individuals who use Ether as collateral and transaction fees.
The amount of time it takes to confirm a transaction also differs between these two major cryptocurrencies. An Ethereum takes only seconds for a transaction to be confirmed while Bitcoin can take minutes.
Which is better?
Both cryptocurrencies have grown since they were initially released. While Bitcoin is an alternative to fiat currency, Ethereum has more applications, including dApps and NFTs, and will make more sense if you are looking to invest in more than just a currency.
Bitcoin and Ethereum are quite different, and your choice of investment depends on why you want to invest and how much you can invest. Bitcoin is the most popular of the two. It is widely accepted and has a higher market cap.
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