In one of my previous posts, I mentioned about cryptocurrencies and how it can possibly yield one of the best ROI. Bitcoin and Ethereum are two of the most common name when it comes to cryptocurrencies. In fact, they reign the crypto world because they are the top two in terms of market capitalization.
But which of the two is better – Bitcoin or Ethereum? In the increasingly crowded cryptocurrency space, never has this question been asked more than it is today. But why do Bitcoin and Ethereum seem to monopolize the debate? Surely, there are more digital currencies that exist.
Bitcoin remains the undisputed market leader, and the market seems to view Ethereum as its main rival. You can’t avoid them if you intend to trade in cryptocurrencies. But Ethereum surpasses Bitcoin in many ways that make it a far better asset for a certain type of investor. Here are some of the reasons why Ethereum is better over Bitcoin.
Lower Block Time
Have you ever wondered why you wait longer while transacting Bitcoins than you do Ether? Well, here’s the answer: It boils down to block time. Ethereum uses the Ghost protocol to transact in a mere 15 seconds – 40 times faster than Bitcoin.
Better Currency Model
Ethereum and Bitcoin approach block rewards – the amount each pays to miners after creating a new block is different. While Bitcoin halves its rewards every fourth year, Ethereum does so every year. To know why this is important, think back to Bitcoins first halving event in 2012. Coins valued at $15.00 that year rose to nearly $40 a year later.
In addition, Bitcoin has been mainly viewed as a store of value while Ethereum has smart contracts capability that can be integrated to real-world use cases.
Built into Ethereum, the so-called Turing-complete code allows infinite computing – that is, so long as the computing power is available. Bitcoin, on the other hand, offers no such flexibility, limiting its computing capabilities.
More Coins in Circulation
With the exception of Ethereum, almost all digital currencies cap the supply of coins. For instance, everyone knows there’ll never be more than 21 million Bitcoins, leading to coin scarcity. This explains why each Bitcoin costs so much – an advantage to sellers, not buyers.
With 92 million coins in circulation and the potential for infinite more, Ethereum is still more available and, thus, within everyone’s reach. You can find out more about buying Ethereum by reading the guide on purchasing Ether that was recently released by Cryptohead.
As the complexities of Bitcoin mining grows, so does the number of small miners leaving the industry. Those left behind don’t have it easier, either. To be more competitive, they opt to centralize their operations sometimes in mining pools. Fortunately, Ethereum approaches the mining problem differently.
Instead of encouraging centralized mining, it discourages the practice in two ways. First, its Ethash algorithm encourages individual mining using your computer’s graphics card. And second, Ethereum’s Ghost protocol does not reward pool mining, discouraging the practice completely.
Ethereum is better in many ways. It’s uses are far more diverse, it’s faster and is more favorable to miners. Also, Ethereum applies a more profitable and sustainable model.