Bitcoin and Ethereum: An Introduction

Cryptocurrencies are well-known alternatives to traditional currency, and Bitcoin and Ethereum are two of the most popular cryptocurrencies.

Although both are often mentioned in the same breath, they’re birthed from the same distributed ledger tech named blockchain. Yet, Bitcoin and Ethereum are not as similar as many people think.

So, what’s the difference between these cryptos, and how can you as an investor (or potential one) take advantage of either or both?

We will seek to explore and answer these questions in this article briefly.

Bitcoin, the largest cryptocurrency, was invented in 2009 by Satoshi Nakamoto. It was created as an alternative with no centralized authority, such as a central bank or other third parties, to regulate transactions. Rather, using blockchain technology, Bitcoin created a secure environment where every transaction exists on a public ledger that’s difficult to manipulate.

Most validators (holders) on the Bitcoin blockchain must verify any transaction for the block to be added to the chain. Bitcoin uses a unique algorithm to encrypt the blockchain data, and validators must decrypt these to verify transactions. Because of these verification codes’ complex and random nature, it’s harder for anyone to manipulate or defraud within a transaction.

Bitcoin started with a next-to-nothing value but has dramatically risen over the years. Today, Bitcoin is commonly referred to as digital gold due to its high value compared with other cryptos.

Yes, Bitcoin is as volatile as other cryptocurrencies, but it remains the most valuable crypto in the market today. The Bitcoin network is powered by its own token, Bitcoin, commonly referred to as BTC.

Next to Bitcoin, Ethereum is the second largest cryptocurrency. It was launched in 2015 with a completely different focus from Bitcoin, to do much more than handle financial transactions.

Ethereum has its own programming language called Solidity. The language is used to create and deploy programs that can host decentralized apps (dApps). These programs are commonly referred to as smart contracts.

This shows that Ethereum was designed to improve Bitcoin, taking blockchain technology much further. According to Mauricio Di Bartolomeo, Ethereum’s drive is to be the world’s cloud computer. No truer words describe what this cryptocurrency offers!

The Ethereum network has its native cryptocurrency, which is known as Ether (ETH).

There are similar risks involved when investing in either Bitcoin or Ethereum. Therefore the answer to the better choice between both cryptos may depend on what you’re looking for.

Bitcoin would be an excellent option as a peer-to-peer (P2P) transaction system, while Ethereum would be more valuable if you’re looking for a network where you can code and deploy smart contracts hosting dApps.

However, experts generally advise that keeping a broad portfolio, investing in both, may be a better approach. Just remember, investing in crypto should be a carefully calculated risk taken.

New to trading? Try crypto trading bots or copy trading

Bitcoin and Ethereum: An Introduction

Cryptocurrencies are well-known alternatives to traditional currency, and Bitcoin and Ethereum are two of the most popular cryptocurrencies.

Although both are often mentioned in the same breath, they’re birthed from the same distributed ledger tech named blockchain. Yet, Bitcoin and Ethereum are not as similar as many people think.

So, what’s the difference between these cryptos, and how can you as an investor (or potential one) take advantage of either or both?

We will seek to explore and answer these questions in this article briefly.

Bitcoin, the largest cryptocurrency, was invented in 2009 by Satoshi Nakamoto. It was created as an alternative with no centralized authority, such as a central bank or other third parties, to regulate transactions. Rather, using blockchain technology, Bitcoin created a secure environment where every transaction exists on a public ledger that’s difficult to manipulate.

Most validators (holders) on the Bitcoin blockchain must verify any transaction for the block to be added to the chain. Bitcoin uses a unique algorithm to encrypt the blockchain data, and validators must decrypt these to verify transactions. Because of these verification codes’ complex and random nature, it’s harder for anyone to manipulate or defraud within a transaction.

Bitcoin started with a next-to-nothing value but has dramatically risen over the years. Today, Bitcoin is commonly referred to as digital gold due to its high value compared with other cryptos.

Yes, Bitcoin is as volatile as other cryptocurrencies, but it remains the most valuable crypto in the market today. The Bitcoin network is powered by its own token, Bitcoin, commonly referred to as BTC.

Next to Bitcoin, Ethereum is the second largest cryptocurrency. It was launched in 2015 with a completely different focus from Bitcoin, to do much more than handle financial transactions.

Ethereum has its own programming language called Solidity. The language is used to create and deploy programs that can host decentralized apps (dApps). These programs are commonly referred to as smart contracts.

This shows that Ethereum was designed to improve Bitcoin, taking blockchain technology much further. According to Mauricio Di Bartolomeo, Ethereum’s drive is to be the world’s cloud computer. No truer words describe what this cryptocurrency offers!

The Ethereum network has its native cryptocurrency, which is known as Ether (ETH).

There are similar risks involved when investing in either Bitcoin or Ethereum. Therefore the answer to the better choice between both cryptos may depend on what you’re looking for.

Bitcoin would be an excellent option as a peer-to-peer (P2P) transaction system, while Ethereum would be more valuable if you’re looking for a network where you can code and deploy smart contracts hosting dApps.

However, experts generally advise that keeping a broad portfolio, investing in both, may be a better approach. Just remember, investing in crypto should be a carefully calculated risk taken.

New to trading? Try crypto trading bots or copy trading