Ethereum is not just a digital currency. It is a blockchain-based platform with many aspects. It features smart contracts, the Ethereum virtual machine and it uses its currency called ether for peer-to-peer contracts. Also Bitcoin’s average block time is about 10 minutes, while Ethereum’s aims to be 12
Main basic difference between Bitcoin and Ethereum is both have very different specifications in every manner.
Here is listed of few considerable factors:
- Bitcoin and Ethereum have different method of preparations for generation of new coins by mining process.
- Bitcoin have SHA256 algorithm for PoW type of work with limited supply and distribution strategic plan according to halving. But Ethereum is based on Ethash algorithm for PoW type of work with no definite supply.
- Bitcoin has the real value for money but Ethereum is basic an altcoin can be used instead of Bitcoin, by using and deploying smart contract.
The difference between Ethereum and Bitcoin is the fact that Bitcoin is nothing more than a currency, whereas Ethereum is a ledger technology that companies are using to build new programs. Both Bitcoin and Ethereum operate on what is called the “blockchain”, however, Ethereum is far more robust. If Bitcoin was version 1.0, Ethereum is 2.0, allowing decentralized applications to be built on top of it. Ether is used broadly for two main purposes: it is traded as a virtual currency and is used inside Ethereum to run applications and even to monetize work.
Purpose: From a general point of view, Bitcoin and Ethereum differ mainly in purpose. While Bitcoin was created as a virtual currency and is thus a medium of transaction and store of value, Ethereum has been developed as a platform which facilitates peer-to-peer contracts and applications. The primary purpose of Ether has always been to facilitate and monetize the working of Ethereum to enable developers to build and run distributed applications.
Block time: It takes around 10 minutes to complete a transaction for Bitcoin whereas for Ethereum it takes just about few seconds. The Bitcoin blockchain has a block limit of 1 MB. So the number of transactions that fit into a single block cannot exceed 1 MB. The time it takes to mine, or create a new block on the Bitcoin blockchain is about 10 minutes. This effectively means that the Bitcoin network can handle 3–4 transactions per second which makes it much slower than Ether as the Ethereum blockchain has no limits.
Value: Bitcoin is far more recognised than any of its peers, making it easier to buy, store and sell. Bitcoin’s value has been growing steadily, making it the most valuable virtual currency. The number of Bitcoins available is limited and will not be exceeded no matter what. Thanks to supply and demand, this means that Bitcoin should, in theory, grow in value. On the other hand, Ethereum will continue to release the same amount of Ether on a regular basis for a long time, so its supply will remain constant and will keep expanding.
Transactions: Bitcoin has always been better at storing value but Ether has become one of the most preferred media for transferring wealth to and from people and entities. In mid-2017, Ether overtook Bitcoin in the number of daily transactions.
Both Bitcoin and Ethereum have advantages over each other, which one is right for you much depends on your financial situation and your willingness to invest.
Bitcoin was the first true cryptocurrency and has been in circulation since 2009. Ethereum is a far more recent development, going live in 2015.
In the time between Bitcoin and Ethereum’s release, lots of other cryptocurrencies emerged. Mostly, however, they were limited to trying to improve on aspects of Bitcoin’s performance – for example, increasing speed of transactions or improving the security or anonymity of transactions.
Ethereum is certainly faster than Bitcoin – with transactions typically settling in seconds, rather than minutes. But it also takes things further. While still blockchain based, and operating as a store of value, its fans and evangelists see it as a platform for distributed computing, which comes with its own built-in currency, called Ether.
While the Bitcoin blockchain can simply be pictured as a database of accounts (or wallets) with an amount of currency stored in each, the Ethereum network blockchain is a more sophisticated construction, capable of storing computer code – applications – that can use the CPU power going into the network to execute.
The currency – Ether – represents this CPU power – so the idea is that Ether will be bought and sold by businesses, governments or individuals to allow them to tap into the vast, distributed resources of the Ethereum network to run their own apps.
The first of these applications are known as “smart contracts”. This is a way of automating contracts and agreements so they will execute when consensus says that conditions have been filled. Though simple, their uses are potentially widespread – such as enabling payment systems which will release funds on completion of work, or authorizing the transfer of ownership of good when payment has been made.
The Ethereum network also allows the creation of other cryptocurrencies, or tokens, using the same protocol as Ether but distributed on different blockchains, which can be public or private. This means they can be created by organizations to represent shares, voting rights or as means of proving identity or authorization credentials.
Bitcoin provides the original concept of decentralized, trustless transactions
Ethereum does the same but adds the ability to perform computations and calculations as decentralized VM, which allows smart contracts and advanced transaction capabilities.
Bitcoin is a ledger for sending and receiving / Ethereum is a platform in which other tokens and dapps can run on and as well can be used as a currency like bitcoin, but it also has smart contracts which bitcoin does not have.
Both offer anonymous transactions, and neither ofthe two is controlled or regulated by a centralised body. While both bitcoin and ether are cryptocurrencies, the ethereum blockchain is very different from the bitcoin blockchain. Bitcoin was designed purely as a digital currency.Dec 20, 2017
While bitcoin max total supply is 25 million, ethereum has no clear maximum total supply. the total supply for ethereum depends on the demand of the market.
One is only a currency (bitcoin) and the other is a platform for games and tokens (ethereum)
While both bitcoin and ether are cryptocurrencies, the ethereum blockchain is very different from the bitcoin blockchain. Bitcoin was designed purely as a digital currency. The ethereum blockchain is a more general implementation of blockchain technology.