Ethereum vs Bitcoin: What’s the Difference

At this point, it’s almost impossible to browse or search social media without coming across the terms “Ethereum” and “Bitcoin.”

These two digital currencies are the most well-known examples of blockchain technology, and their rivalry has continued to grow as they expand their user bases.

Even though both Ethereum and Bitcoin have a lot of similarities, some key differences between the two set them apart from one another as competitors in this space. 

On that note, let’s go over the differences, pros, and cons of both Ethereum and Bitcoin so that you can decide which one is right for your needs.

The Basics

Bitcoin

An idea by Satoshi Nakomoto, is an online currency and store of value with no central authority which can be bought and used as a means of exchange. Bitcoin is not physical but rather online and is run on blockchain technology.

Ethereum 

This is a platform built on the same technology as Bitcoin that allows the deployment of decentralized applications in various areas, and its official currency is called ether (ETH).

Differences

There are a couple of differences that set Bitcoin and Ethereum apart, first off is the ‘Block time.’ Block time is simply the time it takes to mine a new block. For Ethereum, this period is in seconds, while it is in minutes for Bitcoin.

Another difference between the two is that Bitcoin is a financial asset with a value of its own. Ethereum, on the other hand, is a platform that constitutes various applications, and several calculations determine its digital currencies. 

On that note, let’s take a look at the pros and cons of Bitcoin and Ethereum.

Pros of Bitcoin 

One of the best parts of investing in Bitcoin is its liquidity. Being liquid means it is easy for traders to turn their cash or other assets into this currency.

Another advantage of Bitcoin is that due to its popularity, it is now the best network to use for buying or selling, and sending money. 

Lastly, Bitcoin helps protect your identity as some wallets do not require proof of identity to open a wallet.

Cons Of Bitcoin

One of the biggest dangers of Bitcoin is its volatility between December 2021 and August 2022 the price of Bitcoin dropped from $50,000 to $20,000. Because the market is decentralized, you can lose your investments due to its volatility. 

Even though a lot of institutions and businesses accept Bitcoin as a means of payment, the majority of the world is yet to get the status quo. Most of the stores you visit daily do not accept Bitcoin as a means of payment.

Pros of Ethereum

Ethereum’s digital currency, “ether,” provides a secure space for traders to do business without worrying about safety or limits. 

Ethereum forms the backbone of smart contracts. Smart contracts are built on the Ethereum network and have become an intricate part of the metaverse.

Ethereum also has the biggest community of developers, even bigger than Bitcoin’s.

Cons of Ethereum

Ethereum has one of the highest gas fees in the crypto space. Eth gas fees depend on network traffic, and being one of the most popular cryptocurrencies there are loads of people on the network. Ethereum gas fees can be as high as 21000 units.

Many Sites Will Accept Both Bitcoin And Ethereum

If you think you have to pick one instead of the other to invest in, you don’t, as many sites will accept both Bitcoin and Ethereum as a means of payment.

Take, for instance, online casinos, a prominent sector in the gaming industry. ETH casino sites now accept cryptocurrency as a valid means of deposit. Many more industries accept Bitcoin and Ethereum, nowadays, you can even book a flight with crypto.