Among all the popular cryptocurrencies, Bitcoin and Ethereum rank at the top of the list. If you are planning to invest in either of these currencies, it is advised that you do some research beforehand to see which one among these forms of cryptocurrencies would be the right crypto investment pick for you.
This article will help clear things up by comparing the two cryptocurrencies and their plans for future development. Read on this article till the end.
Contents
Difference Between Bitcoin and Ethereum:
* Popularity
Bitcoin and Ethereum are the two most extensive cryptocurrencies in market capitalization (total value of circulating assets) and users.
Ethereum is ranked second, with a $88 billion market cap, while Bitcoin is first, with $143 billion. It’s been gauged that there are currently around 26 million bitcoin users globally.
Ethereum has gained popularity mainly because it is a platform that allows developers to create smart contracts and blockchain applications.
Ethereum’s smart contracts serve as programmable digitized contracts that can store records of financial transactions and establish rules for how these transactions will take place.
* Technology
Bitcoin and Ethereum have different technologies. A blockchain is a shared ledger where all nodes (or computers) on the network can see the exact version of the ledger to ensure that no one is trying to cheat.
Bitcoin runs on blockchain technology, with every node having a full copy of the entire blockchain, which contains every transaction ever made. One of these technologies can be seen with thecryptogenius.software, a platform that can efficiently trade Bitcoin.
This makes it comfortable for users to verify transactions and allows hackers to get massive amounts of personal information.
Ethereum has great technology that makes it possible to create smart contracts and decentralized apps (dapps), a feature investor is looking into more often nowadays.
Ethereum’s technology allows developers to create apps that allow for peer-to-peer transactions in a decentralized fashion. This means no third party is needed to verify transactions when said transactions are done via smart contract.
* Legal Status
Bitcoin and Ethereum are legal in most countries worldwide, though they’re banned in others — just like gold. This makes them good investments if you don’t want to worry about a currency’s status.
Bitcoin is permitted in the United Kingdom and Japan, though other countries also ban it. In China, it is considered a commodity that the government bans.
Ethereum’s regulatory status is less clear in terms of restrictions and bans. While some governments have taken steps to ban Ethereum, there hasn’t yet been any official action against the cryptocurrency itself — though this could change at any time.
For example, China has banned cryptocurrency, specifically Bitcoin trading, on exchanges within its territory. This could prevent people from investing in Ethereum through China-based exchanges or ICOs (initial coin offerings).
* Purchasing
Purchasing Bitcoin is more accessible than purchasing Ethereum. Ideally, it would benefit if you had a wallet with some bitcoins in it before even considering trading for Ether.
There are ways to buy the currency without having a wallet set up, but it is not advised because you may lose your bitcoins if you don’t have them in a digital wallet or through a broker. You can purchase Bitcoin through cryptocurrency exchanges such as Coinbase and Coinmama.
Ethereum can be purchased in the same way as bitcoin, but it’s becoming more popular to purchase Ether directly from those who have mined it using an exchange like Kraken or Bittrex.
* Price
The price of Bitcoin and Ethereum are highly correlated, with the price of Ethereum being 1.3 times the price of Bitcoin compared to USD. With an increase in demand, this correlation can result in a greater increase in the price of Ethereum than that of Bitcoin, or vice versa.
Final Words
When deciding how to invest in Bitcoin or Ethereum, you should consider your personal use case. If you want to invest in a currency that has the potential to increase in value over time so you can sell later for a profit, then Bitcoin is the best option for you.
