Anyone who has the slightest idea about cryptocurrencies knows the name of the two popular ones – bitcoin and Ethereum. Now, there might be loads of different altcoins in the market but nothing comes close to the popularity of these two cryptocurrencies. Naturally, these are also the two cryptos that are compared and pitted against each other the most.
An overview of bitcoin and Ethereum
The cryptocurrency from the Ethereum network, called Ether (ETH), happens to be the second most accepted and popular digital currency right after bitcoin. As Ether is the second-largest crypto in terms of market cap, comparisons are frequently drawn between bitcoin and Ether.
Now, bitcoin and Ether have many similarities. Both are digital currencies traded through online exchanges and kept in different kinds of crypto wallets. These are both decentralized tokens, which means a central bank or such authority does not regulate or issue these tokens. They use a type of distributed tech ledger called blockchain.
But there are a couple of major differences between these two popular cryptocurrencies.
Key differences between Ethereum and bitcoin
Though both Ethereum and bitcoin networks get powered by the ideas of cryptography and digital ledgers, the experts at Ethereum Code point out several technical differences.
Transactions done on the Ethereum network might have executable code, while the data attached to bitcoin network transactions are mainly for maintaining notes. Other differences are the block times and the algorithms they have. Ether takes seconds, while bitcoin needs minutes for confirmation. Bitcoin uses SHA-256 and Ethereum uses Ethash.
Bitcoin is mainly created as an alternative to conventional currencies. Thus, it is a store of value and medium of exchange. Ethereum happens to be a programmable blockchain that has numerous applications, such as NFTs, smart contracts, and DeFi.
Other important questions
-
Why is bitcoin and Ethereum compared to digital gold and digital silver respectively?
Bitcoin is equated with digital gold as it was the first cryptocurrency and the biggest with the market cap of over $1 trillion. Limited supply of bitcoins (maximum number to be mined is capped at 21 million) might help it in retaining its value.
Ethereum is called digital silver because it’s the second-largest crypto in terms of market cap. Similar to the precious metal, it has a wider variety of usage.
-
What are Ethereum and bitcoin’s shares in the crypto market?
On November 29, 2021, the market cap of bitcoin was $1.08 trillion, which accounted for at least 48 percent of the entire crypto market that was valued at a little over $2.25 trillion. On the other hand, Ethereum and its market cap of $528 billion means a market share of around 23.4%.
-
What is the number of ETH and BTC in circulation now?
As per the reports on November 29, 2021, 18,886,912 and 118,545,259 BTC and ETH are in circulation.
Endnote
You can invest in both bitcoins and Ethereum, or you can choose to invest in one. Talk to your crypto broker and let them help to take you the right decision.