What is the difference between Bitcoin and Ethereum?
Bitcoin, a cryptocurrency, which appeared from nowhere and surprised the world, is very common to people at every edge of the world. It has been around since 2009, which means it is the oldest or you can say the first cryptocurrency.
Ethereum is also a cryptocurrency, which got live in 2015, and is relatively new and less popular than Bitcoin. But, unexpectedly, it is giving a tough competition to Bitcoin. It uses Blockchain technology, which is also used by Bitcoin.
People get easily confused about the differences between both these cryptocurrencies. So, let us reduce the confusion and talk about their dissimilarities:
WHAT ARE THEY?
Bitcoin (BTC) is a cryptocurrency, which is used to execute virtual transactions without any physical existence. In simple words, it is a payment system, which allows the transfer of virtual coins or funds in a network-to-network basis. It doesn’t require any intermediate to initiate and validate the transactions.
Ethereum is cryptocurrency and also an open source platform, which allows app development company to build decentralized applications. This platform runs every decentralized application, which was developed on it. It gets all the benefits of the blockchain technology. Ether is its currency unit.
HOW FAST ARE THEY?
Bitcoin is a little slower because the block time is set to 10 minutes. It means that Bitcoin takes 10 minutes to create a new block.
Ethereum wins this one, because it is a lot faster than Bitcoin. The block time is set to 12 seconds, allowing it to create a new block after every 12 seconds. The secret is the “Ghost protocol” used by Ethereum.
HOW DIFFERENT ARE THEIR LANGUAGES?
Bitcoin has an in-built scripting language. It is very limited in terms of functionalities and features. It offers no flexibility to developers.
Ethereum has its own general-purpose language integrated into it. It is known as “Turing-complete”. It provides the flexibility to developers allowing them to write programs, which are called “Smart Contracts”. These contracts let its users create tokens using the Erc20 token wallet and trade in ethers.
COSTING OF TRANSACTIONS
Bitcoin grants the costing of transactions equally because all the transactions compete with each other fairly. Block size is the only factor, which limits the costing.
Ethereum limits the costing according to the complexity of the computation, storage use, and also the bandwidth usage. It affects the transactions costing. The cost assigned by Ethereum to a transaction is termed as “Gas”.
HOW ARE MINERS REWARDED?
Miners are the backbone of any cryptocurrency, which uses Blockchain technology. They help to build all the blocks, which contain the transactional data. These blocks are complex mathematical problems, which can only be solved using great computing power. Whenever a miner creates a block by solving the problems using their CPU power, they are rewarded by crypto coins.
In Bitcoin, these rewards are halved after every 4 years. And, in Ethereum, there is no such thing. Every time the same amount of ether coins is rewarded to the miners.
There are several differences between both of these virtual currencies. But, the reality is that they are like a gold mine for the investors.
Isn’t it true?