Many people consider Bitcoin and Ethereum as rivals, or as the burger king and McDonald’s of the crypto world. Although these concepts may be similar in terms of market cap and public notoriety, they serve different purposes.
If you are planning to invest in cryptocurrency, learning the differences between Bitcoin and Ethereum will lead you down to a more advanced decision. If you want to buy or sell cryptocurrency you can visit swyftx, and get the non-inflated market prices. But before you do that, let’s understand why Bitcoins and Ethereum are different and what makes them ultimately great.
What is Bitcoin?
More than a decade ago, Satoshi Nakamoto executed an idea of a peer-to-peer electronic cash system that could be securely operated without a central bank authority. This idea is commonly known as bitcoin and that’s how cryptocurrency came into being.
Satoshi Nakamoto wasn’t the first person to think of a nonphysical form of currency but the idea of bitcoin was the first one to be approved and recognized by the mass. The value of other cryptocurrencies moves in accordance with Bitcoin. And Bitcoin is the highest traded coin than any other cryptocurrency.
The purpose of the bitcoin was to have an alternative to the basic currencies backed by countries. The traditional currencies are a target of inflation and their values keep changing. A bitcoin, however, is primarily a store of value.
What is Ethereum?
Unlike bitcoin, Ethereum is not exactly a cryptocurrency at all, Ether (ETH) is. Basically, Ethereum is the platform that Ether is based on. It is understandable why people confuse the two. But it’s important to know that you can not call Ethereum Ether, just like you can not call Bitcoin blockchains. Ethereum is a programming language and software platform. Website or app developers build decentralized apps (dApps) on the basis of the platform using the language. In simple words, Ethereum is the platform, and ether powers this platform.
What Are The Major Differences Between Bitcoin and Ethereum?
The primary purpose of bitcoin was to give people a way of transferring value from one user to another without the intervention of any central authority. Whereas, the concept of Ethereum was created based on the idea of blockchain and it does not mimic the bitcoin as a currency. Which is why Ethereum is more than a platform that works as a store of a valuable token. Many investors use Ethereum as a cryptocurrency but that is not its actual purpose.
The Ethereum platform was created to monetize the operations of Ethereum smart contracts and decentralized apps. When Ethereum and Ether were launched, they attracted more users. However, People now use this cryptocurrency for purposes that are outside of its core functionality.
A lot of users are using Ethereum as a platform to hold their bitcoins instead of holding them in the original bitcoin blockchain. Ethereum is considered as a very flexible platform, a user can not hold Ether on the Bitcoin blockchain. But, we know that bitcoin, as a cryptocurrency, is more widely used and accepted as a cash alternative.