Although the truth is that Bitcoin has spent a longer time in the cryptocurrency scene in comparison to Ethereum, it is not the only cryptocurrency which exists. Recently, another project dealing with cryptocurrency was introduced and it has received a lot of attention from the media and random people alike due to its features and applications. That project is known as Ethereum. However, a lot of people are having a difficult time trying to really understand what makes these two different. This article will help to make you see everything clearer and get a grip on the similarities between these two.
To begin with, you should know that Ethereum is more than just a digital currency- it is a platform based on the blockchain technology with so many great features such as the Ethereum Virtual Machine (EVM), smart contracts and it also makes use of its own currency known as Ether to enable peer-to-peer contracts. Another amazing feature which Ethereum has is that it allows application developers to raise funds for various apps which they might be working on. The money which you are able to generate will then be held until you have been able to reach a set goal or until a particular date agreed upon. If this isn’t done, the funds will be returned to its contributors or will go on to the project.
Apart from these features, mining Ethereum can also provide you with the organizational structure which is needed to get your idea running. You could gather proposals from various people who funded your project and then request for their votes concerning how you could proceed. It is more or less a forum dedicated to the success of your project but without the usual costs which you would have to carry if you were to do it the traditional way. Furthermore, Ethereum prevents your project from getting tampered with from outsiders which implies that you will face no downtime.
There are also many other aspects which make Bitcoin mining and Ethereum mining quite different from each other and the first aspect deals with the block times. While that of Bitcoin is around 10 minutes, Ethereum boasts of a block time of about 12 seconds and this is made possible by its unique GHOST protocol. What this implies is that confirmations carried out on Ethereum will be much faster than those made on Bitcoin. Also, while Bitcoin rewards halve once in every 4 years and has a value of about 12.5 Bitcoins, the rewards of Ethereum miners is based on Ethash with 5 ether per block. A major difference between Ethereum and Bitcoin is their monetary supply. More than 2/3 of all available Bitcoins have already been mined while Ethereum on the other hand, spiked its launch capital through a presale and only about half of its available coins will have been mined in its fiftieth year of existence. While Ethereum transactions are known as Gas and costing is based on complexity, storage needs and bandwith usage, Bitcoin transactions are limited to the block size and equally compete with each other. In addition, Ethereum has its own Turing complete internal code meaning that practically anything can be calculated as long as there is enough time and computing power; Bitcoin however, does not have this advantage.
Although a lot of people will compare these two in terms of cryptocurrency, the fact is that they both have very different purposes and projects. Just ensure that you make use of whichever that suits you most.