Bitcoin versus Ethereum: Deciphering the Key Differences

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Whether you’re a pro or an amateur crypto player, you surely know that Bitcoin and Ethereum are currently the top-ranking coins in the market. Being the first and second at that, they tend to be more stable than the thousands of other virtual currencies that emerged after them. 

Sometimes you’re probably thinking about the key differences between the two – and that’s a good mindset. Most investors have pondered on the same matter so that they could decide where to invest their money. If you’re thinking the same way, it only means that you’re serious about your investment. 

To get the greenlight, you have to do some research about these two cryptocurrencies. Although they offer stability and promising returns, you have to dig deeper than that. You have to understand that a cryptocurrency is a multi-faceted asset and there’s an inherent volatility that you have to deal with. The risks and returns are expressed in probabilities, and it’s up to you how to handle these things. When you have a better grasp of the market and its trends, you’re in a profitable position. 

For your best advantage, learn the key differences between Bitcoin and Ethereum in the following facts. Once you’re through, you may consider joining Bitcoin Pro to grow your investments. 

Overview of the Top Cryptos 

Bitcoin is the most popular cryptocurrency today, followed by Ethereum. These two are often compared by investors as they are very close in ranking. They share similarities, especially in terms of being digital currencies traded through online exchanges and stored in crypto wallets. 

These two tokens are also decentralized, meaning that they are not regulated or issued by a central bank or other third parties. They also use a distributed ledger technology, also known as blockchain, in recording all financial transactions done in the network. But there are many crucial distinctions between the two most popular cryptocurrencies, which you will learn below.

Key Differences between Bitcoin and Ethereum 

Although both Bitcoin and Ethereum networks are operated by distributed ledgers and cryptography, they have technical differences. Ethereum may conduct transactions containing executable code, while that of Bitcoin are only intended for keeping notes. The block time and the algorithms on which they run may also differ.

Interestingly, both Bitcoin and Ethereum use proof of work as a consensus protocol, allowing the nodes of the respective networks to agree on the state of all recorded information and prevent certain malicious attacks. As reported, Ethereum will have a different system called proof of stake as part of its system upgrade. This is said to make the platform more secure, scalable, and sustainable.

Ethereum aims to facilitate and monetize the operation of the crypto’s smart contract and dApp platform, and not as an alternative monetary system which Bitcoin has become known for. It is also another use case for a blockchain that supports the Bitcoin network and is not intended to compete with Bitcoin. The popularity of Ether has pushed it into competition with all cryptocurrencies, especially from the perspective of traders. 

As a rundown of key differences, here are the distinguishing facts between Bitcoin and Ethereum: 

• Bitcoin has the highest attention from large investors
• Bitcoin has relative stability, simplicity, and acceptance
• Bitcoin has limited supply
• Ethereum has a different goal than bitcoin
• Ethereum is undertaking more development
• Ethereum has fundamental change in how blocks are created

Which Should You Buy? 

Whether you choose Bitcoin or Ethereum is not a matter of debate, because it’s a personal choice. But as you decide between the two, you have to consider your risk profile and other factors. While both cryptos are seen to take major leaps in the future as more institutions adopt cryptocurrency, Bitcoin is considered the more mainstream and more stable of the two. 

However, it’s possible that Ethereum’s higher risk could bring with it potential for substantial rewards. Over the years, both coins have achieved milestones and overcome the proof-of-concept phase. The good news is, you don’t have to choose between the two, if you want to invest in both cryptocurrencies.

Final Thoughts! 

Investing in cryptocurrency remains highly risky. But this can also equate to promising returns if you can play by the rules. You have to manage the risks while advancing your financial targets. Take inspiration from the story of successful investors and how they have shared success with the two biggest cryptocurrencies today. It’s never too late to join the growing community of crypto investors worldwide.

Source: Press release