Bitcoin vs Ethereum: Whats the Difference?

Please don’t interpret the order in which products appear on our Site as any endorsement or recommendation from us. Finder.com compares a wide range of products, providers and services but we don’t provide information on all available products, providers or services. Please Bitcoin vs. Ethereum appreciate that there may be other options available to you than the products, providers or services covered by our service. Finder.com is an independent comparison platform and information service that aims to provide you with information to help you make better decisions.

Due to lower memory requirements, Bitcoin mining is compatible with ASIC (Application Specific Integrated Circuit) devices, rather than standard computer hardware. ASICs are specialized hardware devices that are tailored to mining Bitcoin and other cryptocurrencies. ASIC devices are expensive, which limits them to larger centralized organizations. This reduces the amount of economically viable participants on the network and means the centralization of Bitcoin mining is a constant risk.

BTC vs ETH: unpacking the differences

BTC and ETH are both decentralized, peer-to-peer cryptocurrencies operating on open-source, distributed ledger (blockchain) technology, and purchasing BTC or ETH on a major crypto exchange is virtually the same process. One might distinguish them in the same way one distinguishes the stocks of two companies in different industries that trade on a major stock exchange. Bitcoin (BTC), the world’s first blockchain-based digital currency, is the largest cryptocurrency product by metrics like market capitalisation and number of unique crypto wallets holding it. Ether (ETH) follows as the native cryptocurrency used in the Ethereum network. The profitability of the two mining options is difficult to compare, as too many variables come into play.

Bitcoin has been used to process payments at different levels and each time, it has shown great potential for even higher applications. Proof-of-stake blockchains do not require mining; instead, they use a process called staking, which incentivizes people to put cryptocurrency at stake to vouch for the accuracy of transactions. Participating users get rewards akin to interest in a bank account when the system works normally.

What is Bitcoin for?

Whether products shown are available to you is subject to individual provider sole approval and discretion in accordance with the eligibility criteria and T&Cs on the provider website. By creating the ERC20 standard, coins are more accessible and transferable, which leads to a wider user base and increased popularity. Investing in Ether is seen by most as an investment and a belief in the development of the Ethereum network.

Validators stand more chance of validating a block and receiving rewards if they stake more assets on the network. Validators on the Ethereum blockchain will need to stake at least 32 ETH to be able to run a node, or they can also join staking pools if they wish to commit a smaller amount. For the Bitcoin blockchain, miners with higher computing power are more likely to earn validation rights for a block and receive mining rewards. Ethereum https://www.tokenexus.com/ stakers also have the option to engage in liquid staking, where they can unlock their staked tokens’ liquidity and engage in activites like selling, lending, and other DeFi activities. The Bitcoin blockchain was designed to handle peer-to-peer transactions and keep records of ‘spend’ and ‘receive’ activities involving bitcoin. The records are kept on a public ledger, and as such are accessible to anyone on the network and outside of it.