Bitcoin Versus Ethereum
Oct 03, 2017 Posted / 7090 Views
Bitcoin and Ethereum are two such cryto-currencies which are huge and quite often compared to each other. But the market price of Bitcoin is much high than Ethereum. Both have been designed for different tasks, but are regularly compared. Let us see what makes Bitcoin different from Ethereum or vice a versa.
Bitcoin was first released on January 3rd, 2009 while Ethereum’s live blockchain was initially launched on July 30th, 2015. Both of these cryptocurrencies are exchanged by using blockchain technology. A blockchain is a public ledger of all transactions that have occurred. Blocks are added in a linear chronological order. The ledger is public because each node has the full blockchain so it cannot be falsified by a single entity.
Bitcoin was designed to act as a secure peer to peer decentralized payment system. Since everything is shown on the public ledger, the blockchain, you can be confident that the transaction is legitimate and the need to trust the other party is negated. Ethereum was designed to be much more than a payment system. It is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference ( as said by the Ethereum Foundation).
Ethereum is written in Turing complete language, which includes seven different programming languages. We can note that this is very different from Bitcoin, which is written in C++ since Bitcoin uses C++ programming and has less than 70 specific commands that can be used.
Contrary to Bitcoin, Ethereum does not have a maximum total number of ether but does cap the amount released each year. Ethereum block times are currently at about 14 seconds, compared to Bitcoin’s 10 minutes.
Ethereum also currently operates on a proof-of-work basis. Miners are rewarded for processing transactions and executing smart contracts, which create blocks. Ethereum is currently working towards changing to a proof-of-stake model which will change the reward system dramatically. Bitcoin operates on a proof-of-work basis. Proof-of-work means that in order to create blocks and add them to the blockchain you must solve very complex mathematical problems
The proof-of-work model, while it does help to increase security and validity, does have some negative effects.In a proof-of-stake model there will no longer be miners, but validators. There will no longer be cryptographic challenges, the difficult mathematical problems that miners must solve.Validators will be required to own ether and in order to validate a block they will be required to put their owned ether on the line to certify that a block is valid.
Bitcoin is striving to provide fast and secure transactions while Ethereum is focusing on much more. As more and more smart contracts and decentralized applications are built Ethereum’s popularity and profitability will increase.
Ethereum’s currency token ether was trading around $8.00/ETH, at the end of 2016 which was near the bottom which spiked more than $15.00/ETH. In the meantime, Bitcoin was trading approximately of 100 times of ether’s price. Both were in two diverse group, but Ethereum has ever since exploded onto the scene in 2017, competing with Bitcoin for crypto domination.
Ethereum utilizes ethash as an alternative of sha-256, which means that people can vie in mining it at the same time as Bitcoin has ASIC chips that have showed the way to a moore's law race as well as concentrated mining power.
Ethereum makes use of a ghost protocol that fends off the utilization of centralized pool mining, while bitcoin still utilizes the pool mining perception.
An additional key dissimilarity among them is their financial supply. More than two-thirds of all obtainable bitcoin have before now been mined, with the bulk going to early miners. Ethereum elevates its launch capital with a presale as well as only about half of its coins will have been mined by its fifth year of subsistence.
Ethereum and Bitcoin also charge their transactions in diverse ways. In Ethereum, it is called Gas, and the estimate of transactions depends on their storage space needs, difficulty and bandwidth utilization. In Bitcoin, the transactions are restricted by the block size and they vie uniformly with each other.
While a lot of people will contrast the cryptocurrency characteristic of both Ethereum and Bitcoin, the actuality is that they are greatly dissimilar projects as well as have dissimilar purposes. Bitcoin has come out as a comparatively steady digital currency, while Ethereum aspires to include more, with ether just a part of its smart contract usage.
The unshakeable performances of the cryptocurrencies i.e. Bitcoin and Ethereum have helped the digital currency market to fly past the $150 bln mark in total market capitalization. The price of Bitcoin improved by 3.1 percent which led it to $4,264.26 during trading on Aug. 23, while the price of its opponent Ethereum increased by 0.4 percent which led it to $324.07, achieving its highest level since June 23.
Although Ethereum and Bitcoin may have similar aspects the two currencies are very different in regards to the use and future of the two digital assets. While the future of Ethereum is uncertain there is an attractive investment opportunity to capture the potential gains of the technology. As for Bitcoin, there is still room for growth and value, but it will not be at the volatile rate it experienced in the beginning years.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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