The market cap of these two cryptocurrencies is at the top as per the studies and ranking of the past few years. People tend to compare these two currencies more often than any other and the reason being the popularity these both currencies carry. We will be talking about all these differences and similarities briefly and most easily, but before that, we ought to know what these currencies are, their origin, their growth with time, and so on.
BITCOIN
Bitcoin originated in the year 2009 by Satoshi Nakamoto by publishing a white paper. Bitcoin is the first such currency to exist in crypto history. The most special characteristic is that it has no central authority who is controlling it, say a bank, government etc. It is primarily a payment network. It works based on blockchain technology which offers transparency in the online transactions taking place.
ETHEREUM
Ethereum on the other hand originated in the year 2013 by Vitalik Buterin by publishing an Ethereum whitepaper. He had worked for bitcoin earlier but after knowing the flaws in this currency he invented his own cryptocurrency named Ethereum. He has an active involvement with this currency. The most fascinating feature of this currency is that it has introduced the smart feature contract that needs no outside party to enforce it. So, if you are planning to trade or mine Bitcoin, then you may visit Click Money
SIMILARITIES
- Both the cryptocurrencies are based on a proof of work mechanism which means there is a certain kind of work surety being given in a particular transaction. This mechanism uses a lot of energy consumption based on the mathematical algorithm that needs to be solved by the miners for mining cryptocurrency.
- Both of the cryptocurrencies use blockchain technology. Blockchain technology enables the encryption of the data provided inside a block. For encryption, there are two types of keys that are used. Both the keys serve different purposes. The one key is the same for both the parties and the other is different for both the parties for carrying a transaction.
- currencies are non-centralized. There is no outside control over the currency and people don’t have to rely on any third party for the security of their money.
- In both currencies, a public distributed ledger is enabled where people have full control over their data and they have a check on the working and all the transactions that are taking place in any part of the world. This is possible because cryptocurrency promotes transparency in every transaction.
DISPARITIES
- The first disparity is that Ethereum not only uses peer-to-peer transactions but also uses smart contracts that are self-executing contracts that need no third party to look after them. This smart contract enables the users to exchange money, share, or anything that possesses value. Whereas, bitcoin enables peer-to-peer transactions only.
- Bitcoin is based on a payment network but Ethereum blockchain technology allows some real-world applications that might range from playing in a casino to banking.
- In reward, the miner gets 12.5 BTC per block whereas in the other case miner receives a reward that is equivalent to 3 ethers.
- In bitcoin, the time taken to form a block takes around 10 minutes whereas in Ethereum it takes around 12-15 seconds.
- For both currencies the hashing algorithm is different. SHA-256 is for Bitcoin and Ethash is for Ethereum.
- Bitcoin has the highest market capitalization compared to Ethereum’s coin circulation which is a lot compared to Bitcoin.
Therefore, the information shared above pertains to the two top cryptocurrencies. I hope it proves beneficial for your crypto future. Thank you!