Bitcoin vs. Ethereum Compared

The cryptocurrency market has a race between the various currencies, and bitcoin and Ethereum are leading the pack. The two currencies are built on blockchain technology to record the transactions made.

Before cryptocurrency was invented, the only way to use money was through an intermediary such as a bank or Paypal. Cryptocurrencies enabled the creation of a decentralized money system that doesn’t require an intermediary. At the moment you can explore Sports News and use bitcoin for betting.

Bitcoin

Bitcoin was invented in 2009 by Satoshi Nakamoto as a digital currency that is used in trading online without the need of a central authority or a third party to confirm the transactions. The transactions in bitcoin are saved up on one ledger that anybody in the world can view at any time. 

Each bitcoin transaction is verified and confirmed by the bitcoin network. This removes the problem of a single place of failure, making the system very hard to shut down or be controlled by a single person.

Blockchain technologies

Blockchain technology was created by fusing various technologies. Cryptography, proof of work, and decentralized network architecture work together to create blockchain technology.

Bitcoin used this technology, and after its invention and when it was noticed, the technology was named blockchain technology. Blockchain is a system where you can build applications and programs. Cryptocurrencies systems such as bitcoin and Ethereum are just applications running on top of the blockchain system.

A truly decentralized system needs an extensive network of computers to run. Bitcoin is written in a Turing incomplete language. The language understands a small set of orders and transaction information.

Ethereum 

Ethereum was first proposed in 2013 by Vitalik Buterin, a co-founder of bitcoin magazine. Ethereum is the decentralized platform for decentralized applications. The decentralized programs are applications that a single person does not control. 

The programs are built on an Ethereum programming language called solidity. The Ethereum network is made of thousands of computers and is fully decentralized. When a program is deployed to the Ethereum network, the nods make sure it is executed. 

Ethereum is the infrastructure for running Ethereum based applications. The currency used as an incentive in the Ethereum network is called Ether. Ethereum’s goal is to decentralize the internet.

The internet is decentralized, but the leading technology companies such as Amazon, Google, and Netflix control most of the world wide web. Almost all activity on the web needs an intermediary or third party. Decentralized networks such as Ethereum provide the possibility of decentralizing the internet where people provide each other services directly to one another, removing the need for companies such as Uber and dropbox.

Ethereum is a network of computers that allows people to connect directly to each other. The computer combines to form one powerful decentralized system. Solidity, the Ethereum programming language, allows the writing of smart contracts.

The Ethereum developers write a program with specific conditions, and the Ethereum network executes it. The Ethereum smart contract deals with all the aspects of the contract as management, enforcement, performance, and payment.

Ether

To run the Ethereum network uses energy and many resources to power the network. Ether is the currency that acts as an incentive for people running the network. To deploy a smart contract to the ether network, its author must pay Ether to complete the deployment.

This makes the network solid and makes people avoid writing unoptimized code that wastes the network resources. Ether was first distributed in 2014 and cost around $0.40 for one Ether. The price of Ether has become very significant because the use of the Ethereum network has grown.

Key differences 

Transactions on the Ethereum network contain code that needs to be excited for a transaction to be completed, while bitcoin transactions are updated on the larger without any instruction.

Ether has a higher traction speed compared to bitcoin. The Ethereum network can manage 15 transactions per second, while the bitcoin network manages 4 transactions per second. The transactions are slower in bitcoin due to the decentralization of the network.

Bitcoin is designed to provide an alternative to money. Ether is a currency on the Ethereum network and was mainly designed to facilitate and monetize the operation of the Ethereum smart contract and decentralized App platform.

Upgrades on a bitcoin network are mostly soft forks meaning that they support backward compatibility, and the users don’t need to upgrade to use up the network. Hard forks often upgrade the Ethereum network, and nodes that don’t upgrade don’t become part of the network.