While both Bitcoin and Ethereum are powered by the principle of distributed ledgers and cryptography, the two differ in many technical ways. For example, the programming language used by Ethereum is Turning complete whereas Bitcoin is in a stack based language.
Bitcoin Vs Ethereum
While both Bitcoin and Ethereum are powered by the principle of distributed ledgers and cryptography, the two differ in many technical ways. For example, the programming language used by Ethereum is Turning complete whereas Bitcoin is in a stack based language. Other differences include block time (Ethereum transaction is confirmed in seconds compared to minutes for Bitcoin) and their basic builds (Ethereum uses ethash while Bitcoin uses secure hash algorithm, SHA-256). (See also: Risks and Rewards of Investing in Bitcoin.)
However, from a general point of view, Bitcoin and Ethereum differ in purpose. While Bitcoin is created as an alternative to regular money and is thus a medium of payment transaction and store of value, Ethereum is developed as a platform which facilitates peer-to-peer contracts and applications via its own currency vehicle. While Bitcoin and Ether are both digital currencies, the primary purpose of Ether is not to establish itself as a payment alternative (unlike Bitcoin) but to facilitate and monetize the working of Ethereum to enable developers to build and run distributed applications (ĐApps).
The Bottom Line
In sum, Ethereum is an advancement based on the principle of blockchain that supports bitcoin but with a purpose that does not compete with Bitcoin. However, the popularity and rising market capitalization of Ether brings it in competition with all cryptocurrencies, especially from the trading perspective. Currently, the market cap of Ether (ETH) is more than Ripple and Litecoin, although it’s far behind Bitcoin (BTC). On the whole, Bitcoin and Ethereum are different versions using the blockchain technology, and are set to establish themselves, driven by different intentions.
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