Bitcoin Vs Ethereum

The battle for supremacy in the cryptocurrency world rankings is as hot as ever, with proponents of different products horning on the credentials of their preferred digital assets over others. This is an industry win which competition is very tough, where products’ value can go up through the sky or dissipate like thin air. One of the most celebrated battles is between Bitcoin and its touted killer Ethereum. A lot of debates have been had so far on this two, and there seems to be no end in sight as both sides and often come with convincing arguments. So politics aside, what is the main difference between Bitcoin and Ethereum? And what makes each a unique product with so much clout over the industry?

Purpose

Bitcoin is the oldest cryptocurrency and was created by a person or group that goes by the pseudonym Satoshi Nakamoto, with the purpose of being the future currency in the world. It was the first fully stable peer to peer means of sending payments from one part of the planet to another without ever needing to use the present banking systems or other forms of intermediaries. The only purpose Bitcoin serve is as an alternative money that moves without any form of restriction

Ethereum on the other hand is more than just a mere cryptocurrency, as it is whole blockchain infrastructure upon which whole independent blockchain apps are built. If Bitcoin for example is an email application it is often said, then the blockchain is the internet upon which it thrives. So also the Ethereum blockchain is a newer super blockchain on which it is theoretically possible to build limitless apps. However it has its own native currency known as the Ether.

Creation

Bitcoin is mined or created using what is known as the proof of work mining protocol, where computers coupled with specialized hardware are deployed to solve humongous amounts of mathematical puzzles where they are rewarded with Bitcoin at the end. The key problem with proof of work is that it is a mining process that consumes a lot of energy and requires further expenditure from cooling equipments as the miners tend to get very heated.

Ethereum however, uses what is known as proof of stake mining protocol, where the network rewards those who stake their own Ether in their wallets for the purpose of helping in keeping the network safe. The big difference here is that you don’t need a mining rig, or pay the huge energy bills that come with them.

Coin Supply

Bitcoin was created with the way gold works in mind. It is made to be relatively scarce where this scarcity is expected to make its value rise with time. There will only be a total of 21 million Bitcoins in circulation ever, out of which about 16.7 million have already been mined and are currently in circulation

Ethereum being the massive virtual machine with limitless possibilities does not have any hard cap on its supply. The only maximum the Ethereum blockchain has is with its yearly supply which is estimated at 18 million Ethers.

Futures

While the debate about which is better than the other might not end anytime soon, the truth is the two blockchain giants have different purposes and objectives in the mind of those who created them. Bitcoin still remains the most recognizable cryptocurrency and blockchain product for now, but with so much clout growing and democratizing the process of building whole new blockchains, Ethereum poses a real threat going to the future where some tout it to one day over take Bitcoin as the most valuable cryptocurrency in the world.