Since its launch in 2009, Bitcoin has maintained its status as the best known, most widely accepted and most traded cryptocurrency. Of course, there are now many altcoins, including Ethereum, which boast the second-largest market capitalization after its more famous rival. Ethereum was launched in 2015, 6 years after Bitcoin, but only really captured the public imagination in March 2017. Traders and analysts often compare the pros and cons of these top 2 cryptocurrencies directly, but their purposes are, in fact, completely different.
Differences in technology
While Bitcoin is most often described as a peer-to-peer payment system, Ethereum is more than just a simple digital currency. Bitcoin and Ethereum are both based on blockchain technology, but the Ethereum platform goes further than its predecessor. It does this with “smart contracts”, using a currency called Ether to create these contracts and to reward miners who approve transactions and add them to the blockchain.
Ethereum is more secure
A smart contract is a piece of code in the blockchain written to govern an online transaction. Thanks to the blockchain, smart contracts can be verified and approved by a decentralized network, ensuring transparency and integrity. Using Ethereum to create contracts reinforces the security of these contracts, as they can’t be modified or deleted once registered in the blockchain.
Ethereum is faster
Of the 2 systems, Ethereum’s average confirmation time of 12 seconds is faster than the 10 minutes it takes on the Bitcoin network. Another difference is their monetary supply: out of a maximum of 21 million Bitcoins, more than 16.64 million have now been mined, whereas 5 years after its creation, only half of the coins on the Ethereum platform have been mined. In terms of block size, Bitcoin implemented a maximum, while Ethereum uses a “gas limit” which is the cost required in Ether to ensure the validation/execution of a transaction or contract.
Ethereum is an advanced cryptocurrency
Bitcoin can be considered as the forefather of all cryptocurrencies and is also the only altcoin widely accepted as a payment method. However, Ethereum offers significant advantages through the use of smart contracts based on blockchain technology. Both cryptocurrencies, however, provide excellent investment opportunities.
Trading cryptocurrencies can be a good way to make extra money and diversify your investment portfolio. Using a respected broker such as UFX.com will allow you to take advantage of the latest unique trading technologies. Remember, though, that cryptocurrencies are volatile assets, and prices can rapidly move up or down. For this reason, you should always use a stop-loss and take-profit orders to control your risk.
Article Submitted By Community Writer