Ethereum vs. Bitcoin: What’s the Difference?

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Today’s most popular cryptocurrencies—with the largest market cap—are both Bitcoin and Ethereum. As far as similarities, though, there aren’t many. These cryptocurrencies have very different dynamics and weren’t created for the same reasons.

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Decentralized currencies have gained broader acceptance since the concept was first introduced. For instance, investing in cryptocurrency can be a smart way to earn passive income. Both regulators and governments are increasingly recognizing that there is a place for virtual currencies, especially alongside such aspects as guarding against inflation, even if this recognition has yet to become formal.

Even though cryptocurrencies don’t enjoy the same status as physical currencies, they do have a place—and there’s something to be said about their continued existence alongside other physical currencies within the worldwide financial system, even if that existence is scrutinized regularly.

Of the many cryptocurrencies available, it’s widely accepted that Bitcoin and Ethereum are at the top of the list - at least at the moment. Which one is better in the Ethereum vs. Bitcoin debate isn’t necessarily a cut-and-dried argument—but it’s an argument that’s getting a lot of attention.

Bitcoin is a popular and the most well-known cryptocurrency in the world. Of all cryptocurrencies, it has the highest market capitalization. Ethereum’s introduction wasn’t met with the same fanfare, but Ethereum’s creator used Bitcoin concepts and created a cryptocurrency with additional capabilities.

What is Bitcoin?

Bitcoin (BTC) was not only the pioneering cryptocurrency, but it’s steadily been the most valuable since its creation by the person or entity known as Satoshi Nakamoto in 2009. Bitcoin’s market capitalization is around 40% of the cryptocurrency asset class—$800 billion currently. (Ethereum, on the other hand, has a market cap of under 20%, coming in at just over $380 billion.) Of all cryptocurrencies, these two have the highest market cap—no other cryptocurrency coins even come close to $100 billion.

No other coin has been traded as long—or has a more recognizable name—than Bitcoin. One of the most attractive characteristics of this coin is its scarcity: No more than 21 million of its coins can ever exist. There are currently nearly 19 million in existence—about 90% of the total mining capability.

What is Ethereum?

Ethereum (ETH), while a coin like Bitcoin, is also a blockchain technology. Ethereum has two main functions:

  1. It’s traded as a cryptocurrency just like other crypto coins

  2. It’s used to run decentralized apps on the Ethereum platform

Ethereum allows smart contracts and decentralized apps to be built, deployed, and run with no downtime or interference, which eliminates the opportunity for fraud and keeps control within the confines of its programming. In addition, Ethereum has its own programming language running on the blockchain, which assists developers in building and running these applications.

Ethereum has wide-ranging potential and is powered by its native token, ether. Its presale launch in 2014 (actual public launch in 2015) was overwhelmingly welcomed. The token, ether, is used by developers as “fuel” to create and deploy apps on the Ethereum platform, to make payments, or as bargaining collateral.

Ethereum vs. Bitcoin Concepts

There are some similarities between these two cryptocurrencies, as well as some major differences.

Bitcoin is the most popular, with Ethereum a close second.

Both are:

  • Digital currencies

  • Traded on an online exchange

  • Stored in a crypto wallet

  • Decentralized

  • Part of blockchain technology

With these similarities, however, there are some key distinct differences.

Bitcoin allows for peer-to-peer transacting and has aspirations of replacing major fiat currencies without the associated issues many fiat currencies are known for. Bitcoin doesn’t have high fees, and the coin is decentralized, meaning there’s no regulation regarding how bitcoin works.

Ethereum also allows peer-to-peer transacting, but it’s also a platform to create and build “smart” contracts and apps. Smart contracts let Ethereum’s users exchange almost anything valuable, from shares to real estate.

Ethereum vs. Bitcoin Numbers

  • Currently, more than 18 million Bitcoin exist. Ethereum has around 118 million coins.

  • Bitcoin market capitalization hovers at just over $780 billion, while Ethereum’s is $368 billion.

  • Around 260,000 Bitcoin transactions occur daily. Ethereum transacts over a million each day.

  • Bitcoin has had more than 718,000 blocks mined since inception. Ethereum has mined around 13 million.

  • It takes longer to add a block to Bitcoin than it does to add one to Ethereum.

  • A Bitcoin block is 1,268 kilobytes. An Ethereum block is just 94 kilobytes.

Ethereum or Bitcoin—Which is the better crypto?

Choosing the better crypto between Ethereum and Bitcoin comes down to what you’ll use it for. If you need a platform for peer-to-peer cryptocurrency transactions, bitcoin is a good choice. If you also need the ability to create distributed apps and to create smart contracts, Ethereum is the market leader.

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*Disclaimer: EquityBrix is not an investment adviser. This information is for educational purposes only and does not constitute investment or tax advice. It’s important to be informed and to make your own investment decisions or do so in consultation with a professional financial advisor. Under no circumstances should this material be used or considered as an offer to sell or a solicitation of any offer to buy an interest in any investment. Any such offer or solicitation will be made only by means of a written online prospectus relating to the particular investment.


What is the main difference in application between Bitcoin and Ethereum?

Both Bitcoin and Ethereum are in the crypto space. But Bitcoin is a crypto coin, while Ethereum is a programming platform with its own coinage. If you only want to buy and sell crypto, choose Bitcoin. If you need smart contracts or distributed apps and crypto, Ethereum is the better option.

Who owns the most bitcoin?

Knowing the cap on the number of bitcoins that can be in the market can help investors understand who owns the most. Bitcoin was introduced in 2009 with a top-out cap of 21 million coins. Today’s bitcoin in circulation is nearing 19 million. Only so much bitcoin can be created in one day, so the bitcoin that has yet to be mined will be done so at a progressively slower pace going forward. That said, when the Bitcoin blockchain was first created by Nakamoto, this person or group mined more than 22,000 blocks in exchange for around a million bitcoins for their efforts. As of April 5, 2022, the current bitcoin price is $45,709, making the value of this holding around $4,570,900,000. There are just three wallet addresses that have more than 100,000 bitcoin.

How many bitcoin are there?

As of April 2022, there are 18,925,137. About every ten minutes, this number fluctuates as new coins get mined. Bitcoin blockchain creator, Satoshi Nakamoto, capped the number of bitcoins that could exist at just below 21 million. This was accomplished within the bitcoin mining algorithm: Once the cap has been met, computers will no longer have the ability to solve the equation or mine for new coins. Just over 2 million coins can still be mined.

How to buy bitcoin on Cash App?

To buy bitcoin on Cash App, download the Cash App application from your mobile phone’s store. Then, create a Cash App account. It’s not necessary to connect a bank account to your Cash App, but it does enable you to transfer funds to and from your Cash App if necessary. To buy bitcoin on Cash App, navigate to the app’s home screen and tap on the bitcoin icon. From here, tap the Buy Bitcoin button. Several amount buttons will populate your phone’s screen—you can choose one of these amounts or tap the three-dot button to enter a different amount. The app will then ask you for your account PIN or for biometric authentication with your fingerprint. After you verify the transaction with your PIN or fingerprint, tap the Confirm button. Whenever you want to buy bitcoin from your Cash App account, you must have funds in the account. If you don’t, you can’t buy bitcoin. This is one of the reasons why having your bank account connected to CashApp can be beneficial.

How many Ethereum are there?

When Ethereum first launched its blockchain technology in 2015, there were only around 72 million Ethereum coins. This number has gradually climbed—in January 2021, around 113 million coins were in circulation. By March 2022, about 120 million Ethereum coins exist.

How to sell Ethereum?

To sell your Ethereum coins, choose an exchange. Then, you’ll need to create an account wallet on that exchange and connect your primary bank account. Next, you transfer your Ethereum and mining rewards onto your chosen exchange. Then, sell your ETH coins in your chosen currency, such as USD, CAD, or your country’s main currency. When you withdraw the proceeds to your bank account, you may have to pay a withdrawal fee to the exchange.

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