Bitcoin and Ethereum are the most dominant coins in crypto, the two hold the top two spots in the world with Bitcoin the number one and Ethereum the number two. Naturally, there is bound to be high interest in both coins. So, how exactly do you go about the comparison of BTC to ETH?
Difference Between BTC and ETH
Although both Ethereum and Bitcoin are cryptocurrencies, there are a lot of differences between them. The major difference between Bitcoin and Ethereum is that Bitcoin is purely a cryptocurrency or simply money in digital form. Meanwhile, Ethereum is a public ledger technology that hosts smart contracts on which many other forms of decentralized apps (DApps) can be built.
The aim of Bitcoin was to replace fiat currencies and centralized financial institutions and provide a decentralized alternative for storing value and transactions. On the other hand, Ethereum’s aim is to be a decentralized system that can host DApps and unchangeable smart contracts.
Data logged on to the Bitcoin blockchain is normally for storing information. Whereas, that of the Ethereum blockchain could include executable code.
There is also a difference in the block time (time taken to complete a transaction). For Bitcoin, it takes minutes to confirm a transaction compared to Ethereum that takes seconds to complete. Also, the algorithms are different as the Bitcoin network runs the SHA-256 algorithm while Ethereum runs the Ethash algorithm.
What Is Ethereum?
The Ethereum network is a blockchain that is built to be more than just a cryptocurrency. As such, the blockchain networks are capable of not just recording and verifying transactions but also hosting DApps and smart contracts. This allows developers to build and launch decentralized apps and smart contracts on the blockchain and then monetize it for usage using the native token Ether as network currency. The Ether cryptocurrency is second only behind Bitcoin in terms of value in the market as of August 2021.
The idea of a blockchain that could look into the shortcomings of Bitcoin first originated in 2013 through Vitalik Buterin who will later co-found the Ethereum network. He wanted something that could offer more than just a form of digital currency or payment. The following year, Vitalik and other co-founders organized crowdfunding to achieve their goal of establishing the Ethereum blockchain. They were able to raise $18M by selling ETH to the participants. By 2015, the blockchain took off with its first live release called the Frontier, and ever since the blockchain has grown leaps and bounds to where it is today.
What Is Bitcoin?
Satoshi Nakamoto, who remains a mysterious figure in the crypto world, created the Bitcoin blockchain. The cryptocurrency surfaced in January 2009 following the plans laid out in the whitepaper that was released. It is built to be a decentralized public ledger that keeps a record of transactions that occur on the blockchain. It offers lower transaction fees and faster processing compared to centralized financial institutions. It helps facilitate payments and is used as a store of value.
Bitcoin.org was registered in the year 2008 in August, and that marked the start of a remarkable journey for BTC. By October 31, 2008, Satoshi Nakamoto announced on metzdowd.com (a Cryptography Mailing list) that he/she/they have been working on a new trustless peer 2 peer electronic cash system.
On January 3, 2009, the genesis block (block 0) of the Bitcoin network was mined followed by the mining of the next block called block 1 on January 9, 2009, and that kick-started Bitcoin mining.
Bitcoin or Ethereum: Which One Is the Best?
It is natural to want to make a comparison and that most of the time is the case with Bitcoin Ethereum. Users may want to know which is the best among the two cryptocurrencies for them. However, in all honesty, the two cryptocurrencies are completely different kinds of crypto. Each with its own use case, strength, and weakness. So, comparing the two to know which is the best between Ethereum Bitcoin is like comparing electricity with gold according to Adelman, CEO of Lolli. Both have their distinctive uses and are very valuable.
However, the comparison seems inevitable from an investment point of view. Nevertheless, this is also down to your risk profile as an investor. That means which one is the best for you depends on the risk you are willing to accommodate. Bitcoin looks the more stable and mainstream of the two. However, Ethereum is more volatile and has a higher risk than Bitcoin but with higher risk comes great rewards. Nevertheless, both crypto will continue to grow as acceptance grows and the world becomes more digitized.
How Do I Compare Bitcoin and Ethereum?
If you want to compare Bitcoin and Ethereum, how do you go about it? You can make use of the CSS (CoinSocialStory) analytic and comparison tools. We will discuss how you can use CSS in making your analyses below.
CSS offers a remarkable real-time cryptocurrency comparison tool that you can use to compare BTC to ETH. You can compare and select the best one that fits your portfolio profile. The CSS tool compares both cryptos over five metrics including trading volume, network status, total supply, social engagement, and market cap. All five metrics are computed into a total score for both cryptos in an easy and visually attractive way as shown below.
In the image below, you will find Bitcoin and Ethereum on either side of the comparison tool with Bitcoin on the left and Ethereum on the right. Let’s break down all the metrics one by one:
Total score: The total score is reflected at the top of the comparison tool, in the image below you will see Bitcoin having a score of 83 and Ethereum having a score of 66.
Market Cap: The next metric is the market cap, which has shown below indicates that Bitcoin has a market cap of $882.59B compared to Ethereum that has a market cap of $363.88B.
Total Supply: In the comparison chart, we see Bitcoin having a total circulating supply of 18.92M compared to Ethereum that has a total circulating supply of 117.50M. This is not surprising given that Bitcoin’s maximum supply is 21M.
Trading volume: The trading volume for Bitcoin is $35.93B compared to Ethereum that has $19.38B to indicate that Bitcoin has a higher trading volume than Ethereum.
Social Engagement: this indicates the social presence of both coins and it shows Bitcoin having the upper hand here with 14.53K compared to Ethereum with 8.14K.
Network Status: Going by the comparison chart, the number of activities on the Bitcoin network is also higher with 241.12K compared to Ethereum that has 196.00K.